Revised Laws of Saint Lucia (2021)

Co-Operative Societies Regulations – Section 238

(Statutory Instruments 90/1999 and 72/2001)

Statutory Instrument 90/1999 .. in force 30 October 1999

Amended by S.I. 72/2001 .. in force 23 June 2001

ARRANGEMENT OF REGULATIONS

CO-OPERATIVE SOCIETIES REGULATIONS – SECTION 238

Commencement [30 October 1999]

1.   Citation

These Regulations may be cited as the Cooperative Societies Regulations.

2.   Definitions

In these Regulations—

“association” means a group of people organised for some common purpose but without corporate personality;

“bank” means a bank registered under the Banking Act;

“corporation” means a body corporate incorporated under law;

“document” means a report, return or other document required to be sent to the Registrar under the Act or these Regulations;

“former-Act” means the Cooperative Societies Act, 1946;

“society” means a registered primary, secondary or tertiary society as defined in regulation 21(1);

“unincorporated organisation” means a body of persons not incorporated under law.

3.   Forms required

The forms set out in Schedule 1 are to be used for the purposes of the Act and these Regulations.

4.   Fees

The fees to be paid under the Act and these Regulations are those fixed in Schedule 2.

5.   Filling out of document

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   (1)   Where an item required to be disclosed in a document does not apply, the person preparing the document shall indicate that by placing the phrase “not applicable” or the abbreviation “N/A” in the space provided in the document.

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   (2)   Where—

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      (a)     any provision required to be set out in a document is too long to be set out in the space provided in the document; or

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      (b)     an agreement or other document is to be incorporated by reference and to be part of the document,

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   the person preparing the document may incorporate the provision, agreement or other document.

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   (3)   A provision, agreement or other document referred to in subregulation (2) may be incorporated by—

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      (a)     setting out the phrase: “The annexed (number) schedule is incorporated in this form” in the space provided on the document; and

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      (b)     annexing the provision, agreement or other document to the document.

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   (4)   A separate annex is required with respect to each item that is incorporated by reference in a document under subregulations (2) and (3).

6.   Dividend rate

The board of directors shall recommend to the annual general meeting the rate of dividends to be paid on shares and the annual general meeting may either approve the rate recommended by the board of directors or approve a lower rate such however that the annual general meeting shall not at any time approve a higher rate of dividends than that recommended by the board of directors.

(Substituted by S.I. 72/2001)

7.   Transfer of shares

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   (1)   The Registrar may determine the forms to be used for the transfer of shares.

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   (2)   A transfer of a share shall not be registered if made by a member who is indebted to the society, without the approval of the board, and until the transfer of a share is registered no right shall be acquired against the society by the transferee nor shall any claim of the society upon the transferor be affected thereby.

8.   Minimum amount of fidelity bond

1.  

   (1)   For the purposes of section 87 of the Act, a blanket security or fidelity bond shall be given by all officers including the president, vice-president, secretary, treasurer, secretary-treasurer, manager and any other authorised signing officer, and every employee of the society.

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   (2)   In respect of the credit union the amount of security or fidelity bond required is $50,000.

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   (3)   In respect of other cooperative societies the minimum amount of the security or fidelity bond is—

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      (a)     $1,000 in the case of a society with sales or revenue not exceeding $25,000 per year;

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      (b)     $2,000 in the case of a society with sales or revenue greater than $25,000 but not exceeding $100,000 per year; and

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      (c)     $5,000 in the case of a society with sales or revenues greater than $100,000 per year.

9.   Annual financial statements and special returns

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   (1)   The comparative financial statements required under section 124 of the Act must include—

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      (a)     a balance sheet;

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      (b)     a statement of income;

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      (c)     a statement of retained earnings; and

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      (d)     a statement of changes in financial position.

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   (2)   Financial statements need not be designated by the names set out in paragraphs (a) to (d).

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   (3)   Additional periodic performance returns, as required by the Registrar under section 141(3) of the Act, shall also be provided in an accurate and timely manner so that the Department's records are up-to-date and reliable.

10.   Auditor's report

For the purposes of section 137 of the Act, the auditor of a society shall indicate in his or her report whether or not the financial statements contained in his or her report—

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   (a)     were prepared in accordance with generally accepted accounting principles; and

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   (b)     are presented on a basis consistent with that of the preceding year.

11.   Standard of financial statement and Auditor's Report

The financial statements referred to in section 124 of the Act and the auditor's report referred to in section 137 of the Act must, except as otherwise provided by these Regulations, be prepared in accordance with standards approved by the Institute of Chartered Accountants of Saint Lucia.

12.   Election of directors

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   (1)   This regulation applies for the purposes of section 50 of the Act.

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   (2)   Before accepting the nomination of a person, the chairperson of the meeting called to elect directors shall satisfy himself or herself that the person to be nominated—

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      (a)     is qualified under the Act and the by-laws of the society to be director; and

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      (b)     has consented to the nomination.

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   (3)   Where the number of candidates nominated does not exceed the number of directors to be elected, the chairperson of the meeting called to elect directors shall declare all the candidates elected.

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   (4)   Subject to subregulation (7), only one ballot is to be taken and the number of candidates equal to the number of directors to be elected receiving the highest number of votes are to be declared elected.

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   (5)   Where candidates are to be elected for varying terms, the candidates receiving the highest number of votes cast are to be declared elected for the longest or the longer terms, as the case may be.

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   (6)   For the purposes of these Regulations a term shall not exceed 3 years.

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   (7)   Where 2 or more candidates receive an equal number of votes, the members present at the meeting may, by resolution, provide that a second ballot be cast to break the tie.

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   (8)   Where the meeting does not decide to hold a second ballot under subregulation (7), the chairperson of the meeting called to elect directors shall draw lots, and the candidate whose lot is drawn is to be declared elected.

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   (9)   Where a member votes for more than the number of directors to be elected on his or her ballot, his or her ballot is not to be counted.

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   (10)   Where a registered society submits a bye-law to the Registrar that provides for a method of electing directors other than at a general meeting of members and the Registrar is satisfied that the bye-law does not contravene subregulations (4), (5), (6), (7), (8) and (9), the Registrar may approve the bye-law and, on and after the date of that approval, the directors of the society shall be elected in the manner provided in the bye-law.

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   (11)   A society shall not include in any bye-law governing the manner of electing its directors any provision that prohibits its members from nominating as a candidate for election as director any member who—

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      (a)     is qualified to be a director; and

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      (b)     consents to the nomination.

13.   Meetings of directors

The directors of a registered society shall hold at least one meeting every month.

14.   Appointment of Secretary and Treasurer

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   (1)   This regulation applies for the purposes of section 51 of the Act.

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   (2)   The board of directors of a society shall—

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      (a)     appoint a secretary and treasurer to the society and a secretary or treasurer shall not hold office for more than 2 consecutive terms; or

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      (b)     appoint a secretary and a treasurer and unless the secretary and treasurer so appointed are members of the board, shall have power to fix the remuneration for their service.

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   (3)   An appointment made or remuneration fixed by the board in accordance with subregulation (2) shall not be valid, effective, payable or recoverable unless the appointment and remuneration are approved by the Registrar.

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   (4)   The Registrar shall inform the board in writing of the approval and remuneration of the secretary and the treasurer.

15.   Duties of Secretary and Treasurer

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   (1)   The secretary of a society shall—

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      (a)     keep the minutes of any meeting of the society or board;

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      (b)     ensure that all records, books, papers and other documents of the society are kept in a safe place in the office of the society;

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      (c)     conduct any correspondence on behalf of the society;

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      (d)     attend all meetings of the society and the board and have with him or her the necessary minutes and record books and correspondence relative to the business of the society;

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      (e)     issue notices for all meetings of the board and general membership of the society in accordance with the Regulations and bye-laws;

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      (f)     sign and execute, jointly with the president, all deeds and conveyances real or personal property, all fixed deposits or share certificates and such other documents as the board may specify;

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      (g)     review the minutes of all committees of the society; and

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      (h)     perform such other duties as are prescribed by the bye-laws or authorised by the board.

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   (2)   The treasurer of the society shall—

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      (a)     receive all monies due and payable to the society and issue receipts for the same;

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      (b)     deposit all monies received in the name of the society in such bank or depository as specified by the board;

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      (c)     sign all cheques, notes, bills of exchange and other documents necessary to effect the business of the society;

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      (d)     keep a just and true record of all financial transactions effected by the society in the books provided for the purpose;

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      (e)     keep charge and control of all cash, securities, books and other documents and vouchers for all payments made and receipts issued on behalf of the society;

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      (f)     reconcile or cause to be reconciled at least once per month the members' ledger or accounts;

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      (g)     reconcile or cause to be reconciled at least monthly, all passbooks or statements received from depositories with the relative control accounts in the general ledger;

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      (h)     keep separate all monies belonging to the society;

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      (i)     produce a current statement of the society's monies on demand;

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      (j)     prepare the annual statement of accounts, the balance sheet, the monthly financial statements and any other statements as the board may request;

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      (k)     make payments as authorised by the board and obtain receipts for the same; and

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      (l)     perform any other duties as the board may prescribe.

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   (3)   The duties of the secretary and treasurer may be modified or altered in keeping with the allotment of duties assigned by the board to the manager and other employees of the society.

16.   Supervisory Committee

For the purposes of sections 62 to 68 of the Act and subject to the Act and bye-laws, the supervisory committee shall—

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   (a)     meet immediately after the first annual general meeting and immediately after each annual meeting of the society to organise for the current year;

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   (b)     appraise the policies and operating procedures of the society and make recommendations to the board and to the credit committee;

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   (c)     attest to the monthly and annual returns filed in compliance with sections 124 and 141 of the Act;

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   (d)     determine periodically but not less than once per quarter, whether the provisions of the Act, regulations, bye-laws and the relevant policies have been complied with—

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      (i)     in making loans, including loans to officials, business loans and loans to organisations, associations and corporations,

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      (ii)     in respect of any overdrawing from deposit accounts,

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      (iii)     in the administration of members' accounts,

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      (iv)     in the maintenance of the minutes of meetings of the board and the credit committee;

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   (e)     receive and investigate any complaints made by members of the society about management of the society;

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   (f)     monitor the management of the society;

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   (g)     ensure that the society complies with the provisions of the Act, regulations and bye-laws; and

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   (h)     verify the assets of the society and monitor whether the assets are properly protected.

17.   Education Committee

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   (1)   The board of directors shall, appoint a committee which shall consist of 5 persons, who may also be members of any other committee.

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   (2)   The committee shall be in charge of education and propaganda and will advise and act in collaboration with the leaders of discussion groups, assist in the provision of literature for the use of members, and arrange for the purchase of books and magazines, particularly in relation to the Co-operative Movement, and such literature that will be useful for education.

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   (3)   The committee shall submit to the board of directors a report of its activities, and a requisition to cover the cost of literature, and any other materials, according to the funds set for that purpose.

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   (4)   The committee shall ensure that the education fund is used for the purpose for which it is intended, and in conformity with the requirements of section 33(7) of the Act, and the rules of the registered society.

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   (Inserted by S.I. 72/2001)

18.   Procedures on appeal of termination of membership

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   (1)   Where a person appeals the termination of his or her membership to the Registrar under section 31 of the Act, the person shall submit a written statement of membership to the Registrar within 30 days of the date of—

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      (a)     the members' resolution terminating the person's membership under section 29 of the Act; or

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      (b)     the members' confirmation of the directors' order terminating the person's membership under section 28(2) of the Act.

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   (2)   A person appealing the termination of his or her membership shall state in his or her written statement required under subregulation (1)—

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      (a)     any reasons for the termination of his or her membership of which he or she has personal knowledge;

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      (b)     the grounds on which his or her appeal lies; and

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      (c)     any relevant facts or information, in addition to those described in paragraphs (a) and (b), that the Registrar may require.

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   (3)   The Registrar shall hear an appeal under section 31 of the Act within 30 days after the date on which he or she receives a completed written statement under subregulation (1) and inform the appellant, in writing, of the outcome of the appeal within 14 days after hearing the appeal.

19.   Unclaimed amounts in case of terminated member

Where the amount held to the credit of a member whose membership has been terminated—

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   (a)     is less than $50, the society may add that amount to its income from operations; or

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   (b)     is $50 or more, the society shall place that amount in a special reserve fund.

20.   Amendment of Bye-Laws

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   (1)   Where under sections 10 and 48 of the Act a registered society amends its bye-laws, such amendment shall be made by a resolution of members of the registered society at a general meeting.

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   (2)   Every resolution under subregulation (1) shall not be valid and effective unless it was taken by a majority of not less than ²/₃ of the members present at the general meeting at which the resolution was proposed.

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   (3)   A copy of a resolution under subregulation (1) shall be forwarded to the Registrar together with 3 copies of the amendment.

21.   Bye-Laws of housing society

For the purposes of section 204, a housing society must provide in its bye-laws that—

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   (a)     the society shall give a copy of the bye-laws and the occupancy agreement to every member;

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   (b)     each member is entitled to have quiet enjoyment of his or her housing unit;

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   (c)     either the society or the member is responsible for—

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      (i)     the maintenance of the housing unit in a safe, habitable and reasonable state of repair,

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      (ii)     the repair or replacement of fixtures, and

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      (iii)     any damage to the housing unit;

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   (d)     the society and its agents, except in the case of an emergency, are required to give reasonable notice to the member prior to entry of the member's unit;

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   (e)     the society shall give 3 months notice of any increase in housing charges except where—

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      (i)     the Registrar gives his or her approval for a shorter notice, or

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      (ii)     the members have unanimously approved the increase at a general meeting;

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   (f)     the society shall give a minimum of 30 days notice to a member of the termination of his or her membership, except where a member contravenes any bye-laws governing—

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      (i)     ordinary cleanliness of the housing unit after having received written notice of the contravention,

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      (ii)     the use of the premises for prohibited purposes, or

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      (iii)     payment of housing charges; and

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   (g)     there is to be no acceleration of housing charges.

22.   Liquidity

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   (1)   For the purposes of this regulation—

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      (a)     “liabilities” include any deposits of money made in the credit union, any accrued interest on those deposits and any loans taken out by the credit union;

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      (b)     “line of credit” means the maximum amount which a credit union is entitled to borrow at any given time;

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      (c)     “liquid assets” include Eastern Caribbean currency and deposits of Eastern Caribbean currency made by a credit union with a bank or any other institution that takes deposits, and that the credit union is entitled to withdraw on demand as readily marketable securities;

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      (d)     “marketable securities” include treasury bills, government debentures, treasury notes and other securities listed on the Eastern Caribbean securities exchange;

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      (e)     “secondary society” means a registered society which comprises mainly primary societies; and

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      (f)     “tertiary society” means a registered society all of whose members are secondary societies.

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   (2)   A credit union shall at all times—

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      (a)     have in its possession liquid assets; or

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      (b)     maintain a line of credit,

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   in an amount sufficient to enable the society to meet its normal cash flow requirements as estimated by the society.

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   (3)   A credit union shall at all times maintain an account—

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      (a)     with a bank;

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      (b)     with a loan company or trust company incorporated under the Companies Act; or

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      (c)     with a secondary society or a tertiary society whose bye-laws provide for the acceptance of deposits, if the deposits can be repaid on demand.

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   (4)   The account mentioned in subregulation (3) shall be—

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      (a)     in an amount that is not less than 10% of the total liabilities of the registered society as shown on the society's most recent financial statement prepared and submitted in accordance with regulation 10; and

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      (b)     in the form of demand deposits or deposits redeemable on the notice of the society.

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   (5)   A credit union shall maintain the account described in subregulation (3) separate and apart from any other accounts or funds.

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   (6)   Despite subregulation (4)(b) and subject to subregulation (7), where a credit union—

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      (a)     was registered under the former Act, as that Act existed on the day before the coming into force of these Regulations; and

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      (b)     maintained, on the commencement of the Act, a reserve,

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   the moneys maintained, on the commencement of the Act, in the reserve mentioned in paragraph (b) may be used to satisfy the requirements of subregulation (4)(a).

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   (7)   Where—

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      (a)     a credit union specified in subregulation (6) does not otherwise have sufficient moneys on account to satisfy the requirements of subregulation (4)(a); and

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      (b)     any part of the reserve mentioned in subregulation (6) consists of unencumbered securities of the Government,

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   those securities shall mature within 5 years of the coming into force of these Regulations in order to be eligible to be used to satisfy the requirements of subregulation (4)(a).

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   (8)   Where securities will mature after 5 years of the coming in force of these Regulations, the credit union shall, as soon as practicable after the coming into force of these Regulations, sell those securities and use the proceeds of the disposition to purchase deposits in accordance with the requirements of subregulation (3).

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   (9)   Within 6 months of the coming into force of these Regulations, a credit union shall maintain at least 50% of the amount required by subregulation (4)(a) in liquid assets.

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   (10)   Subject to section 119(3) of the Act, where a credit union does not have in its possession liquid assets, does not maintain a line of credit or does not do both of those things in an amount sufficient to enable the credit union to meet its normal cash flow requirements as required by subregulation (2), the credit union may use the amount in its account required to be maintained by subregulations (3) and (4) to satisfy the requirements of subregulation (2).

23.   Loan approval

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   (1)   An application for a loan must be made on a form provided by the society and must state—

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      (a)     the purpose for which the loan is required;

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      (b)     the security, if any, offered; and

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      (c)     any other information the credit committee or loans officer requires.

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   (2)   When a loan application is approved, the credit committee or loans officer approving the loan shall approve the application in writing and ensure that the application and approval specify with respect to the loan—

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      (a)     the amount approved;

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      (b)     the terms of payment;

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      (c)     the rate of interest;

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      (d)     any security to be held by the credit union;

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      (e)     any guarantees to be taken;

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      (f)     any conditions that may be specified by the credit committee or the person approving the loan in addition to those mentioned in paragraphs (a) to (e); and

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      (g)     the date of the approval.

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   (3)   A loan granted by a credit union shall be evidenced by a signed loan agreement between the credit union and the applicant.

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   (4)   A member of a credit committee or of the board or supervisory committee or any other person who has been authorised to approve loans shall not be present at the discussion of the approval of or approve a loan to himself or herself or any person with whom he or she has a fiduciary relationship.

24.   Borrowing by director etc

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   (1)   Subject to sections 115(3), 115(4) and 115(5) of the Act, an officer, director, credit committee member, supervisory committee member, or employee of a society shall not borrow from the society an amount in excess of his or her holdings therein in shares, deposits and accumulated earnings unless—

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      (a)     adequate security is provided for the amount of the loan in excess of the value of the shares, deposits, accumulated dividends and interest; and

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      (b)     the loan is approved by the vote of ²/₃ of the other members of the board, credit committee and supervisory committee sitting together.

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   (2)   A meeting referred to in subregulation (1) is not properly constituted unless a quorum of the members of the credit committee is present.

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   (3)   A registered society shall not lend to any member an amount exceeding—

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      (a)     ten per cent of the aggregate of the registered society's share capital, retained earnings and reserves;

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      (b)     the aggregate of the members' ordinary deposits and the society's reserves; or

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      (c)     such lesser percentage as is specified in the bye-laws.

25.   Security for loans

The board of directors shall, by resolution, establish a policy with respect to—

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   (a)     the collateral security or guarantors required for approved loans; and

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   (b)     the manner in which the fair market value of any real property obtained as a security for a loan is to be calculated.

26.   Maximum period for interest on loans

For the purposes of section 199(1) of the Act, interest on loans may be paid at intervals not exceeding one month.

27.   Loan terms and conditions

The terms and conditions upon which each loan shall be granted and repaid shall include the following—

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   (a)     every application for a loan shall be accompanied by such information about the financial position and income of the borrower as the credit committee or loan officer may require;

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   (b)     a society shall not make a loan to an unincorporated organisation;

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   (c)     where a loan under paragraph (b) is contemplated, it shall be made to one or more of the members or officers of the organisation but the society shall, in any such particular case, require such additional security by way of endorsement of the promissory note as may be deemed desirable;

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   (d)     a loan shall not be made to a member if it would cause the total indebtedness of the member to the credit union to exceed 10% of the paid-up capital and deposits of the credit union;

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   (e)     the total of all loans made to associations, organisations or corporations shall not, at any time, exceed 25% of the total shares and deposits of the credit union;

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   (f)     a loan shall not be made to a company unless such loan is personally guaranteed by shareholders of the company holding a majority of the shares in value and in voting rights provided that such personal guarantee shall not be required where the loan is guaranteed by an organisation or agency of government approved by the Stabilisation Fund Board;

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   (g)     a loan shall not be made by a society to a corporation if a majority of the shares of the corporation are held by the officers and directors of the credit union unless the application has been approved by the Registrar in consultation with the League Board;

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   (h)     all transactions in the loan account of a member shall be shown by the necessary entries in a passbook or statement to be delivered to each member;

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   (i)     where a mortgage on land or buildings is taken as security for a loan, the amount loaned shall not exceed 80% of the market value of the land or buildings and where it is being contemplated to loan an amount which exceeds 80% of the market value of the land or building, approval shall first be granted by the Registrar of Co-operatives; (Substituted by S.I. 72/2001)

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   (j)     before such a loan is made, the credit committee or loan officer shall require that an appraisal of the market value of the property be made by an appraiser whom they believe to be competent and who is instructed and employed independently of any owner of the property on a form prescribed by the league and approved by the Registrar;

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   (k)     the expenses, if any, of any appraiser employed under paragraph (j) may be borne by the applicant for the loan.

28.   Bad and doubtful loans

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   (1)   When the whole or part of a loan made by a credit union remains unpaid for a period of 24 months after the date fixed for repayment in full of the monies loaned and no payment on account of principal has been made after that date, the amount of the principal remaining unpaid, subject to the approval of the board, shall be charged to and paid from the statutory reserve fund less any money standing to the credit of the borrower on the books of the credit union in a share or deposit account and less the market value of any security held by the credit union in respect of the loan.

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   (2)   The board may, with the Registrar's approval, reduce the period of 24 months under subregulation (1);

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   (3)   Any monies subsequently recovered with respect to such loans shall be paid into the reserve fund.

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   (4)   All interest which has been collected thereon during the current year shall be deducted from the loan before the write off is made.

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   (5)   With the approval of the board, any collection fees or commissions, or legal charges incurred in the collection of the loan which are not reversible from the debtor may be added to the loan before the write off is made.

29.   Doubtful loans allowance

1.  

   (1)   When a credit union identifies a loan as a doubtful or uncollectable loan, the credit union shall immediately allow for the doubtful loan by—

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      (a)     establishing on its books and accounts an allowance for the doubtful loan in an amount equal to the difference between—

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         (i)     the book value of the loan, including any interest due and unpaid and interest accrued, and

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         (ii)     the realisable book value of the loan as estimated by the credit union;

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      (b)     reporting on any income statement it prepares, including its annual income statement required under regulation 10, as a loss from income an amount as an allowance for doubtful loans equal to the sum of allowances for all doubtful loans established in accordance with paragraph (a); and

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      (c)     reporting on any balance sheet it prepares, including its annual balance sheet—

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         (i)     the value, as an asset, of its doubtful loans in an amount equal to the value of all of the doubtful loans as stated on its books and accounts less the allowance for the doubtful loan established in accordance with paragraph (a), and

      1.  

         (ii)     any property or other assets acquired in the financial years under a foreclosure realisation proceedings on a loan that was a doubtful loan at an amount not greater than the realisable value of the loan—

         1.  

            (A)     as estimated by the credit union under paragraph (a)(ii); and

         1.  

            (B)     as stated on the books and accounts of the credit union before the property or assets were realised under the foreclosure or other proceedings.

1.  

   (2)   Despite subregulation (1), a former-Act society in respect of the financial year prior to the society's continuance may, instead of charging its allowance for doubtful loans to its income in the manner required by subregulation (1)(b), charge the amount of the allowance as calculated under subregulation (1)(a) to the reserve required by the Act.

1.  

   (3)   A credit union shall report, at the end of each financial year, to the Registrar—

   1.  

      (a)     the number and amount of doubtful loans for which an allowance has been made in accordance with this regulation in that financial year;

   1.  

      (b)     the amount of allowance for doubtful loans made under subregulation (1) or (2) in the financial year; and

   1.  

      (c)     the value of property and other assets recovered in that financial year on doubtful loans.

1.  

   (4)   The board of directors of a credit union shall cause a list of all doubtful loans to be available at the registered office of the credit union for any examination required by the credit committee, supervisory committee and the auditor of the credit union, and the board shall send a copy of that list to the Registrar.

1.  

   (5)   The list mentioned in subregulation (4) includes, with respect to each doubtful loan—

   1.  

      (a)     the name of the borrower;

   1.  

      (b)     the amount of the loan; and

   1.  

      (c)     the amount of any allowance under this regulation.

1.  

   (6)   Where a credit union determines that the allowance for doubtful loans required by subregulation (1) will result in a net loss on its income statement for the financial year, it shall immediately notify the Registrar in writing of that fact.

30.   Overdue loans

1.  

   (1)   The loss exposure on outstanding loans at the end of the fiscal year, shall be calculated in accordance with Schedule 3.

1.  

   (2)   For the purpose of these Regulations “overdue loans” means personal, mortgage or other types of loans on which the member is in default for more than 90 days on a payment of principal or interest according to any agreement he or she has with the credit union.

1.  

   (Substituted by S.I. 72/2001)

31.   Investment

1.  

   (1)   Moneys not required for current purposes of the credit union may be deposited or invested in accordance with section 114(1) of the Act.

1.  

   (2)   Section 114(1)(d) shall include shares and debentures in a suitably established Stabilisation Fund.

32.   Use of statutory reserves

1.  

   (1)   Subject to the approval of the Registrar, a society may use its statutory reserves—

   1.  

      (a)     to make good, deficiencies created by its operations; and

   1.  

      (b)     to recoup losses on its investments.

1.  

   (2)   When the Registrar receives a request for approval under subregulation (1), he or she may—

   1.  

      (a)     exempt the society from compliance with regulation 29(1)(a) for any period of time that he or she considers appropriate;

   1.  

      (b)     restrict the purposes for which the society may use its statutory reserves; or

   1.  

      (c)     do all or a combination of the things mentioned in paragraphs (a) and (b).

33.   Credit Committee

1.  

   (1)   For the purposes of section 57 of the Act and subject to the Act and the bye-laws, the credit committee of a credit union shall—

   1.  

      (a)     recommend to the board policies and procedures to be followed by the credit union for approving and granting loans made by the credit union;

   1.  

      (b)     monitor, through reports from the credit union's auditor and other officers of the credit union, loans procedures used by the credit union;

   1.  

      (c)     review all applications for loans, loan extensions and revisions of the terms of loans that are referred to it by the board or an officer of the credit union; and

   1.  

      (d)     review reports of officers of the credit union that are submitted to it under subregulation (2).

1.  

   (2)   The credit committee shall keep a record, with respect to each application for a loan or a renewal or extension of a loan considered by it, of—

   1.  

      (a)     the name of the applicant;

   1.  

      (b)     the amount of the loan applied for or the change in the terms or conditions applied for; and

   1.  

      (c)     whether the application was approved, declined or deferred.

1.  

   (3)   Where, in the opinion of the Registrar, the policies of the credit union are not sufficient to protect the deposits of the credit union's members, the Registrar may, in writing, direct the credit union to take measures to protect those deposits.

1.  

   (4)   Where—

   1.  

      (a)     the Registrar has sent a written directive under subregulation (3);

   1.  

      (b)     the credit union fails to take measures that protect the deposits of the credit union's members, or the measures taken are, in the opinion of the Registrar, insufficient;

   1.  

      (c)     the Registrar is of the opinion that the credit union has not sufficiently protected the deposits of its members,

1.  

   the Registrar may direct the credit union to adopt and follow any policies that the Registrar may impose and the credit union shall adopt and follow those policies and the board of directors of the credit union shall ensure that the credit union adopt and follow those policies.

34.   Interest on bad and doubtful loans

1.  

   (1)   For the purposes of section 199(2) of the Act, interest payments are not to be included in the credit union's income where the interest payment is with respect to a doubtful loan for which an allowance has been made under regulation 29.

1.  

   (2)   Subject to subregulation (3), a credit union may include in its income a maximum of 3 months accrued interest with respect to a loan.

1.  

   (Amended by S.I. 72/2001)

35.   Deposits

1.  

   (1)   Subject to this regulation the terms and conditions for the receipt of deposits by a registered society shall be set out in the bye-laws of the society.

1.  

   (2)   A credit union shall not establish and operate, without the approval of the Registrar, deposit accounts that permit funds in the account to be withdrawn or transferred by the depositor by means of—

   1.  

      (a)     a cheque,

   1.  

      (b)     another bill of exchange; or

   1.  

      (c)     any other negotiable instrument,

1.  

   that allows the holder of the negotiable instrument to have payment on demand made to him or her from funds in the deposit.

1.  

   (3)   A credit union shall not, without the approval of the Registrar, accept funds on deposits for a term that is stipulated in any agreement between the credit union and the depositor to be longer than 5 years.

1.  

   (4)   Where a credit union accepts deposits for a term that is stipulated in an agreement between the credit union and a depositor, the credit union shall provide a receipt to the depositor showing—

   1.  

      (a)     the terms and conditions under which the funds are deposited by the depositor and accepted by the credit union;

   1.  

      (b)     the date on which the deposit matures;

   1.  

      (c)     the rate of interest to be paid by the credit union on funds deposited;

   1.  

      (d)     the time when interest is to be paid by the credit union; and

   1.  

      (e)     any conditions that the board has stipulated for withdrawals of funds by the depositor prior to the date the deposit matures.

1.  

   (5)   Where a person has deposited funds in an account with the credit union, the person is entitled to receive and the credit union shall provide a statement showing the transactions conducted by the person involving the person's account, the balance of funds in the account and any other information that the credit union considers important.

1.  

   (6)   The board may, in consultation with the Registrar, determine the form in which the statements required under subregulation (4) are given.

36.   Maximum liability on deposits and loans

1.  

   (1)   In pursuance of section 117 of the Act, every registered society shall fix, at a General Meeting, the maximum liability the society may incur in loans or deposits from a member or a non-member.

1.  

   (2)   The maximum fixed by subregulation (1) is subject to the approval of the Registrar.

1.  

   (3)   A registered society shall not exceed the maximum approved by the Registrar under subregulation (2).

1.  

   (4)   The Registrar may, at any time, review the maximum approved under subregulation (2) and vary that maximum.

1.  

   (5)   A society shall not accept shares or ordinary deposits of more than $10,000 in any one transaction from a member or non-member without an accepted declaration of the source of funds.

37.   Bank account

1.  

   (1)   The directors of a registered society may open and maintain an account at any bank.

1.  

   (2)   Cheques drawn on an account mentioned in subregulation (1) may be signed by the treasurer of the society and a director.

1.  

   (3)   Despite subregulation (2), the board may authorise the manager or another senior employee to perform any of the duties of the treasurer, including the signing of cheques.

38.   Branches

1.  

   (1)   In this regulation, “branch” means any office of a credit union where the credit union proposes to carry on business, including accepting deposits and operating a chequing service, separate and apart from its head office.

1.  

   (2)   Credit unions may open a branch for servicing their members, having first obtained the Registrar's approval in writing.

Schedule 1

Schedule 2

Schedule 3

Co-Operatives Societies (Appeals Tribunal) Regulations – Section 238

(Statutory Instrument 48/2003)

Statutory Instrument 48/2003 .. in force 10 June 2003

ARRANGEMENT OF REGULATIONS

PART 1
PRELIMINARY

PART 2
PROCEDURE AND MEETINGS OF TRIBUNAL

PART 3
APPEALS

PART 4
HEARING OF APPEALS

CO-OPERATIVES SOCIETIES (APPEALS TRIBUNAL) REGULATIONS – SECTION 238

Commencement [10 June 2003]

PART 1
PRELIMINARY

1.   Citation

These Regulations may be cited as the Co-operative Societies (Appeals Tribunal) Regulations.

2.   Interpretation

In these Regulations, unless the context otherwise requires—

“Act” means the Co-operative Societies Act;

“Appellant” means any—

1.  

   (a)     Co-operative society;

1.  

   (b)     member or former member of a Co-operative Society; or

1.  

   (c)     any person who is aggrieved by a decision of the Registrar or Arbitrator;

“Arbitrator” means any person appointed by the Registrar for the purpose of hearing a dispute;

“Chairperson” means the Chairperson of the Tribunal;

“member” in relation to an appeal means a member of the Tribunal entitled to sit for the purpose of hearing and determining that appeal;

“Minister” means the Minister with responsibility for co-operatives;

“Registrar” means the Registrar for Co-operatives appointed under section 5 of the Act;

“Secretary” means Secretary to the Tribunal;

“Tribunal” means the Co-operative Societies Appeals Tribunal established under section 188 of the Act.

PART 2
PROCEDURE AND MEETINGS OF TRIBUNAL

3.   Procedure and meetings

1.  

   (1)   The Tribunal shall meet at such times as may be necessary or expedient for the transaction of business, and such meetings shall be held at such place and time and on such days as the Chairperson may determine.

1.  

   (2)   The Chairperson may at any time call a special meeting of the Tribunal and shall call a special meeting within 4 days of a requisition for that purpose addressed to him or her by 2 members of the Tribunal.

1.  

   (3)   The Secretary to the Tribunal shall give to every member of the Tribunal notice of a meeting at least 72 hours before the time appointed for holding the meeting.

1.  

   (4)   The Chairperson shall preside at meetings of the Tribunal and if at any meeting the Chairperson is not present within 30 minutes of the time appointed for holding the meeting, the members present may choose one member among themselves to preside at that meeting.

1.  

   (5)   The decisions of the Tribunal shall be by a majority of votes.

1.  

   (6)   Minutes in the form the Chairperson may direct of each meeting shall be kept by the Secretary.

1.  

   (7)   The Chairperson shall keep notes of the meeting and the notes shall be as authoritative as the minutes kept by the Secretary.

1.  

   (8)   Subject to these Regulations, the Tribunal shall have power to regulate its own proceedings.

PART 3
APPEALS

4.   Application

This Part shall apply to all appeals filed on or after the date on which these Regulations are made.

5.   Notice of Appeal

1.  

   (1)   An appellant may appeal, by notice in writing, to the Tribunal within 14 days of the decision of the Registrar or Arbitrator.

1.  

   (2)   The notice of appeal referred to in subregulation (1) shall be signed by the Appellant and 6 copies of the notice of appeal shall be submitted to the Secretary.

1.  

   (3)   A notice of appeal shall be dated as of the day on which it is signed and shall state—

   1.  

      (a)     the name of the Appellant;

   1.  

      (b)     the Appellant's office, if any;

   1.  

      (c)     the date of the decision from which the Appellant desires to appeal;

   1.  

      (d)     the person or authority from whose decision the Appellant desires to appeal;

   1.  

      (e)     the date on which the Appellant received notice of the decision he or she desires to appeal;

   1.  

      (f)     the decision which the Appellant seeks from the Tribunal;

   1.  

      (g)     an address to which any notice or other document may be sent to the Appellant from the Tribunal; and

   1.  

      (h)     the reasons in detail for the appeal.

1.  

   (4)   A notice of appeal shall be in the form set out in Schedule 1.

1.  

   (5)   The Secretary shall publish in the Gazette an address where notice of appeal may be given under these Regulations.

1.  

   (6)   A notice of appeal shall be given to the Secretary either personally or by sending it by registered mail to the address published under subregulation (5).

6.   Record

The Secretary shall as soon as possible after receiving a notice of appeal compile a record which shall consist of the—

1.  

   (a)     notice of appeal;

1.  

   (b)     notes of evidence;

1.  

   (c)     relevant documents and exhibits if any;

1.  

   (d)     reasons for the decision of the Registrar or Arbitrator.

7.   Transmission of the record

1.  

   (1)   The Secretary shall, as soon as possible after compiling the record under regulation 6, send one copy to each of the following persons—

   1.  

      (a)     the Chairperson;

   1.  

      (b)     all other members of the Tribunal;

   1.  

      (c)     the Appellant; and

   1.  

      (d)     the Registrar or Arbitrator.

1.  

   (2)   The copy of the record to be sent to the Appellant and the Registrar or Arbitrator shall be sent either personally or by registered mail.

8.   Application for extension of time

1.  

   (1)   The Tribunal may extend the time within which an appeal shall be brought under these Regulations.

1.  

   (2)   An application to extend the time within which an appeal shall be brought shall be in writing and the provisions relating to appeals shall, with the necessary modifications, apply to an application under this regulation as they apply to notices of appeal and to the proceedings in appeals.

1.  

   (3)   An application to extend the time within which an appeal shall be brought shall be in the form set out in Schedule 2.

1.  

   (4)   Where the Tribunal extends the time within which an appeal shall be brought, the application to extend the time shall be determined by the members of the Tribunal.

PART 4
HEARING OF APPEALS

9.   Constitution

1.  

   (1)   A hearing by the Tribunal shall comprise the Chairperson and all the members of the Tribunal.

1.  

   (2)   At any hearing by the Tribunal, in the event of a split decision, the hearing shall be reconvened with all the members of which the Tribunal was comprised.

1.  

   (3)   Whenever the Chairperson sits on an appeal he or she shall preside at the hearing.

10.   Hearing by Tribunal

1.  

   (1)   A hearing by the Tribunal shall take place at least 60 days after the date of the Registrar's or Arbitrator's decision.

1.  

   (2)   At least 7 days before the date fixed for the hearing of an appeal, the Secretary to the Tribunal shall by notice in writing advise the Appellant and the Registrar or Arbitrator of the date on, and the place at which the appeal has been set down for hearing.

1.  

   (3)   A notice under subregulation (2) shall be given to the Appellant and the Registrar or Arbitrator either personally or by sending the notice by registered mail.

1.  

   (4)   At least 7 days before the hearing of the Tribunal, the Secretary shall, whenever practicable, cause the notice referred to under subregulation (2) to be published in the Gazette.

1.  

   (5)   At every hearing by the Tribunal the Appellant and the Registrar or Arbitrator shall be entitled to appear in person or by a representative.

1.  

   (6)   The hearing of an appeal by the Tribunal shall be in private.

1.  

   (7)   An appeal to the Tribunal shall be a review of the record.

11.   Powers of Tribunal

1.  

   (1)   The Tribunal shall have power—

   1.  

      (a)     to require any person to produce any document which the Tribunal may consider necessary for the purpose of the appeal;

   1.  

      (b)     to summon to attend at the hearing of an appeal any person who in its opinion is or might be able to give evidence respecting the appeal;

   1.  

      (c)     where any person is summoned to examine him or her on oath;

   1.  

      (d)     to adjourn, strike out, dismiss or proceed with the hearing of an appeal where the Appellant or the Registrar or Arbitrator fails to appear;

   1.  

      (e)     to adjourn from time to time as the Tribunal sees fit;

   1.  

      (f)     to determine the procedure to be followed in an appeal.

12.   Decisions

1.  

   (1)   Upon every hearing of an appeal, the Tribunal may affirm or set aside the decision appealed or may make any other decision which the Registrar or Arbitrator could have made.

1.  

   (2)   The Secretary shall, as soon as possible after the Tribunal has decided an appeal, send a copy of the decision to—

   1.  

      (a)     the Appellant;

   1.  

      (b)     the Registrar or Arbitrator.

1.  

   (3)   A copy of a decision under subregulation (2) shall be sent to the Appellant and the Registrar or Arbitrator either personally or by registered mail.

13.   Pending appeals

The procedure to regulate all appeals pending before the Tribunal before the date on which these Regulations are made shall be as the members sitting for the purpose of hearing those appeals determine.

Schedule 1

Schedule 2