<Q> What Acts does the Department of Co-operative and Friendly Societies administers?
<A> The Department has the responsibility of administering the Co-operative Societies Act of 1950 and the Friendly Societies Act of 1966. 

<Q> What type of Societies can be registered under these two (2) Acts?
<A> Co-operative Societies are registered under the Co-operative Societies Act. However there are three (3) types of Societies that can be registered under the Friendly Societies Act: Friendly Societies, Benevolent Societies; and Specially Authorized Societies.

<Q> What are Co-operatives?
<A> Co-operatives are autonomous association of people, usually of limited means, who join together on a voluntary basis to achieve a common objective. This objective may be to market products, to purchase supplies or to provide services such as housing, credit union, and thrift to name a few. To achieve this objective the people form a business organization, which is democratically controlled through which they pool their skills and resources.  More»»

 

<Q> How many persons are necessary to start a Co-operative and what are the requirements?

<A> The minimum number of persons required to form a Co-operative is ten (10).  More»»

<Q> What are the Principles and Features of Co-operatives?
<A> The main purpose of a Co-operative is to provide goods and services to its members/users at a minimum cost; while maximize the net and real income of the members/users. More»»

 

<Q> What is the minimum financial requirement for the establishment of a Credit Union?
<A> A minimum capital base sufficient to generate revenue to meet at least the following expenses:  accommodation, audit fees, utilities, stationary, security, salary and and related costs.

 

<Q> What  returns should be submitted to the Department?
<A> Societies registered under the...

        Friendly Societies Act:  Annual Return, Return of Members and Investment, Quinquennial Valuation and Financial Records for audit.

        Co-operative Societies:  Members share listing, quarterly financial reports and records for audit/independent Auditor's report

<Q> When was the first Co-operative registered in Jamaica?
<A> On November 3, 1950, Nathan's Staff Co-operative Credit Union Limited was registered as the first Co-operative Society in Jamaica.
 

<Q> Can the word "Co-operative"  or "Credit Union" be used in the title of a business or company?

<A> Only registered Societies may use the word "Co-operative", "Co-operation" or any abbreviation or the word "Credit Union" of Credit Unions" or any abbreviation in their title.  Any person found guilty can be punishable by Law (Section 58 of the Co-operatives Societies Acts).

 

<Q> What are Friendly, Benevolent and Specially Authorized Societies?
<A    These are Societies geared at providing assistance to members, their relatives and dependents during sickness, old age or on becoming a widow or orphan and community development respectively . More»»

 

<Q> What are the requirements for registering a group under the Friendly Societies Act?

<A> The minimum number of persons required to obtain registration under the Friendly Societies Act is twenty-one (21). More»»

 

<Q> What is an Inaugural General Meeting?
<A> This is the first General Meeting after the Society obtains its registration.  It is important as it allows the members to elect individuals to sit on the various Committees of the Society, especially the Committee of Management.  The elected Committee of Management is required to meet within ten(10) days after the Inaugural General Meeting to elect its officers and is required to submit a list of the names, addresses, positions and telephone numbers of all members of the Committee of Management along with the other committees' Chairmen to the Registrar of Co-operative Societies & Friendly Societies.
 

<Q> How to plan for the Inaugural General Meeting?
<A> At least one (1) month after the registration of the Society, the Steering Committee should meet and begin to plan the Inaugural General Meeting. Paramount of which is the selection of the Nominating Committee, venue and proposed date of meeting. The Department may be contacted for a clear guideline to be used when planning the meeting.  

 

<Q> Is a representative of the Department required to be present at every Annual General Meeting (AGM) including the Inaugural General Meeting?

Yes. This is so because the Department’s representative is to ensure that Societies' AGM are conducted in accordance with the Society’s Rules and the respective Act. They are to ensure that the following are observed:-

• a Quorum is present

• the Agenda is followed

• parliamentary procedures are observed

• elections of Officers are properly conducted

<Q> What if a representative of the Department was not present and the election was conducted improperly? What are the avenue(s) for correction?

On the advice of the Department the C.O.M / B.O.D must call a Special General Meeting to address the situation.
 

Q> What is Arbitration?

<A> The Co-operative and the Friendly Societies Laws makes provision for cases of disputes involving Societies, their Committees, officers, members (past, present and deceased) and their beneficiary to be referred to the Registrar. It is a process by which the parties in a dispute submit their differences to the judgement of an impartial person or group, selected by mutual consent or the majority opinion.

<Q> What are the disputes that may usually be referred to the Registrar for Arbitration?

<A> Only those dispute where both parties are members of the Co-operative's or Friendly Society's "family" may be referred to the the Registrar.  That is where disputes arises:

i.  Among members, past members and beneficiary of members, past members and deceased members;
ii. Between members, past members and beneficiary of members, past members and deceased members and the Society, its committee or any officer of the Society;
iii. Between the Society and its committee or any officer of the Society;
iv. Between two (2) registered Co-operative Societies or two (2) registered Friendly Societies.

<Q> Who can request an Arbitration?

<A> Arbitration by be reference by any of the following :-

i. The Board
ii. The Society in accordance with a Minute of the General Meeting

iii. Any party to the dispute
iv. Any member (past, present and deceased or their beneficiary), where the dispute concern a member (past, present and deceased or their beneficiary) of the Board and the society

<Q> How does one initiate an Arbitration?

<A> Arbitration by be reference by any of the above individual in writing.  It shall:-

i.  be dated
ii. specify dispute
iii. give full particulars
iv. state the name of the arbitrator(s) of your choose, which may be selected from the Panel of
    Arbitrator or the aggrieved party may request that the Registrar make the selection.

v.  be signed

<Q> What is the Arbitration Process?

<A> 1.  The Registrar on the receipt of a reference will then refer it for disposal to an arbitrator(s).  This shall be in writing and shall:-

i. Give name, address and occupation of Arbitrator
ii. Detail of dispute
iii. Limit on the  time for making the award.  The Registrar has the power to vary the time limit at his discretion;

<Q> How can a Society be dissolved/cancelled?

<A> A society may be dissolved in one of three ways.  If ...

i.  After carrying out an inquiry or making an inspection under Section 40 of the Co-operative Societies Act or Section 56 under the Friendly Societies Act the Registrar may cancel the registration of a Society.

ii. Three-quarter (3/4) of the members of the Society may request its dissolution.

ii.  At any time it is proved that the number of members has been reduced to lese than ten for Co-operatives and less than twenty one (21) for Friendly Societies the Registrar may cancel the registration of any society .

<Q> What is the Liquidation Process?

<A> Liquidation is the process of taking a business' real assets and turning them into cash, either to pay off debt or to reap a personal profit. It is the selling of assets and the paying of liabilities in anticipation of going out of business. Liquidation may be done either voluntarily or in response to a declaration of bankruptcy as a way of repaying a portion of debtors. In most cases, liquidation occurs when a firm’s business is terminated. The Assets are sold and the proceeds are used to pay creditors, then any remaining money is distributed to members/shareholders.

<Q> What does the Liquidation process entails?

<A> Section 44 of the Co-operative Societies Act and Section 61 of the Friendly Societies Act give authority to the Registrar for appointment of a Liquidator to undertake the duties and responsibilities of Liquidation.

Upon appointment the Liquidator’s powers in executing his/her functions are subjected to the direction and control of the Registrar and any limitations imposed by the Registrar. (See the Co-operative Societies Act Sections 45-46 and the Friendly Societies Act Sections 62 – 63).

<Q> What are the legal positions of the Liquidator?

 

<A> They are:-

i.  The property of the Society is not that of the Liquidator but remains vested in the Society.
ii  The Liquidator is not entitled to the protection afforded to Trustees acting in good faith with regards to default of agents employed. Therefore the Liquidator is always deemed to be responsible for the acts of his agent.
iii. The Liquidator or his agent may neither acquire the assets of a Society nor make a profit from dealing in those assets without the leave of the Registrar.
iv. The Liquidator will be liable if he personally commits a tort; in the instance of a ‘tort of deceit or the tort of negligent misstatement’. He will however, not generally be liable if he makes an innocent misrepresentation.
v. The Liquidator clearly has a duty to perform honestly and properly the Office which he is undertaking; should the Liquidator fails in this area personal liability can arise.

<Q> What is the cost associated with undertaking the Liquidation?

<A> Subject to Section 63 (g) of the Friendly Societies Act and Section 46 (g) of the Co-operative Societies Act, the Registrar is authorized to make an order for the remuneration of the Liquidator. The costs of liquidation are normally taken directly out of the Society's assets. These costs include advertising for the sale of the assets, insurance to cover the sale, a direct fee to the liquidator, and costs for disbursing assets to purchasers.

<Q> What is the deadline for Members to make claim on the Liquidation Funds?

<A> Subject to Section 49 (2) of the Co-operative Societies Act, when the liquidation process for a society has been closed; and any creditor of that society has not claimed or received what is due to him under the scheme of distribution, Notice of the Closing of the Liquidation shall be published in the Gazette; and all claims against the funds of the society liquidated shall be barred when two years have elapsed from the date of the publication of the Gazette notice.


<Q> What is the difference between a Credit Union and a Thrift Society?

<A> While both types of Societies are a form of depository for primarily consumer savings (and may offer loans), they present different advantages and weaknesses More»»

 

<Q> What if the Society is in need of institutional strengthen such as training (e.g. accounting, strategic management, budgeting, auditing, etc) or policy development (e.g. Internal Operations Policies, Employment Policies & Related Issues, Reserve Policy, Reporting Policy, etc.)?

<A> The Department may assist the Society in providing a wide range of training programmes and Policies. One may even be custom developed to suit the Society’s. This may be provided at minimal or no cost to the Society. If the Department is unable to assist the Society, attempts will be made to direct them to the appropriate entity.

 

 

Still in the dark? For additional information on Co-operatives and Friendly Societies please visit or contact the Department

                         or follow this link for other information of the law or to ask Mr. Co-opman.
 

Last Updated: July 13,  2008