Review of Co-op Laws in Singapore (1997)

----------------------------------------------------------------------
This document has been made available in electronic format
by the International Co-operative Alliance (ICA)
----------------------------------------------------------------------

Part II - Review of Country Laws in Singapore (1997)

Source: Co-operative Laws in Asia and the Pacific
by G.K. Sharma (pp.160-165)

Singapore
********
After separation of Singapore from Malaysia it continued to use the
old Malaysian Co-operative Law till a separate co-operative societies
act was enacted and became operative from September 28, 1979
and has 102 articles.

Part I : Preliminary
-----------------------
This part deals with definitions and appointment of Registrar and
Assistant Registrar.

Part II : Formation and Registration of Co-operatives
---------------------------------------------------------------
Under article 4 a society with only the following objectives can
be registered:

a. which has as its object the promotion of the economic interests
        of its members in accordance with co-operative principles;

b. which, while having regard to the economic interests of its
        members in accordance with essential co-operative principles
        has, as its object, the promotion of the economic interest of
        the public generally, or any section of the public; or 

c. which is a society established with the object of facilitating
        the operations of a society referred to in paragraphs (a) and (b). 

Under article 5 a primary co-operative can be formed with a minimum
membership of 10 persons and a secondary society needs 2 or more
societies or trade unions.

Under article 39 (1) Singapore citizens and residents in Singapore
only can be member of a co-operative. However, under article
7 (i) (g) representatives of at least two societies have to sign the
registration papers.  

The registrar under article 8 can ask information for registration as
he deems fit as under:

a. the economic or other need for the formation of the proposed
        society; 
b. a statement as regards the viability of the activities of the
        proposed society; 
c. the availability of sufficient capital for the commencement
        of operations; and 
d. the availability of officers capable of directing and managing
        the affairs of the proposed society and of keeping such records
        and accounts of the society as the Registrar may require.

Under article 9 in case of refusal for registration appeal can be made
within 2 months. 

Part III : Privileges and Duties of Societies
---------------------------------------------------
Article 13 dealing with secondary co-operatives prescribes:

i.      Societies may form secondary societies and an apex organisation. 

ii. The apex organisation when formed and registered shall provide,
        organise and supervise effective centralised services for
        co-operative education and training, supplies, marketing, banking,
        transport, accounting, audit and such other services as may be
        necessary for the members. 

An interesting provision under article 15 (4) (b) is the provision of
referendum for amendment of bye-laws.

Under article 21 members have to sell their produce through the
co-operatives as provided in the bye-laws and in case of default, they
can be made to pay damages.

Article 22 provides imposition of fines on infringement of the bye-laws
by a member but fine of more than S$50  would need prior approval
of Registrar.

Under article 33 annual audit has to be done by the Registrar or a
person authorised by him. Under article 34 a society has to submit
within six months of the closing of the account, an annual report of
the previous year activities and financial statement and audit report to
the registrar.

Part IV : Rights and Liabilities of Members
----------------------------------------------------
Under article 39 trade unions can be members of secondary
co-operatives but cannot be members of primary or apex society. 

Under article 42 principle of one member one vote is applicable in case
of primary society but in secondary co-operatives voting right would be
as per the bye-laws. 

Part V : Organisation and Management of Societies
--------------------------------------------------------------
Under article 51 a primary co-operative having more than 300
members can have representative delegates but the number of
delegates shall not be less than 20.

Under article 56 quorum of General Meeting has been laid down as
one fifth or 50 voting members which even is less. In case of no
quorum an adjourned meeting shall be convened at not less than seven
and not more than fifteen days at the same venue and time in which no
quorum will be needed. Amendment to bye-laws cannot be considered
in such a meeting. 

Under article 59, a managing committee shall have not less than 5 and
not more than 30 members. Under article 2 the managing committee has
to meet at least once a quarter.

Article 64 provides payment of remuneration to the members of the
managing committee as approved by General Body but shall not be
more than the sum to be fixed by the registrar from time to time.

Part VI : Property and Funds of the Society
----------------------------------------------------
Under articles 67 and 68 advancing loan to non-members has to be
with the approval of the Registrar.

Under article 70, reserve fund has to be at least 20% of surplus.
Under article 72 every society has to contribute 5 % of surplus to
Central Co-operative Fund which will be administrated as trust fund
in such a manner as the minister may subscribe in the rules.

In addition to dividend, not more than a limit determined by the
Minister, patronage rebate or any other funds as prescribed in the
bye-laws, may also provide for a charitable purpose up to 10%
under article 73. A society can distribute a part of its net surplus
among its members as bonus shares or bonus certificates.

Bonus certificates can be encashed not before 5 years and shall bear
no interest or dividend. In case of bonus shares the minimum period
is 10 years after which they can be transferred or withdrawn. 

Part VII : Amalgamation and Transfer
---------------------------------------------
This part provides procedure for amalgamation of societies as also
transfer of assets from one society to another society.

Part VIII : Duties and Powers of Registrar
--------------------------------------------------
This part deals with powers of the Registrar relating to audit,
inspection, enquiry and winding up.

Article 81 provides: 

i. If an audit, inquiry or examination of books made under this
Act discloses any defects in the working of a society, the
Registrar may bring such defects to the  notice of the society
and if the society is affiliated to a secondary society or apex
organisation, also to the notice of that other society.

ii. The Registrar may make an order directing the society or its
officer to take such action as may be specified in the order within
the time mentioned therein to remedy the defects disclosed in the
audit, inquiry or examination of books. 

Failure of the removal of defect can result into registrar issuing orders
for winding up the society.

Article 88 provides disposal of assets after liquidation which along
with others include payment of dividend and patronage rebate for
any period during which they were not paid according to the limit
prescribed in the bye-laws.

Thereafter, any funds left will be transferred to liquidation fund with
the registrar for a period of 2 years and then will be transferred to
central co-operative fund.

Article 90 provides surcharge and attachment for damages caused
to the society and article 91 provides settlement of disputes.

Under article 92 case of question of law that matters can be referred
to Chief Justice for opinion by the Registrar or the Minister.

Article 94 provides to the Registrar to suspend the activities of the
society or nominate a committee for a total period not exceeding
two years.

Part IX : Miscellaneous
----------------------------
Article 95 provides for making rules under the law and article
100 provides penalty for non-compliance of the act.

..