Cooperative Societies Rules, 1991 (G.N. No. 408)

Co-operative Societies Rilles C.N. No. 408 (contd.t RULES. Made under section 123 THE COOPERATIVE SOCIETIES RULES, 1991 PART I PRELIMINARY 1. These rules may be cited as the Cooperative Societies Rules, 1991, and shall come into operation on the date when the Cooperative Societies Act, 1991 comes into operation. 2. In these rules, unless the context otherwise requires:­ "the Act" means the Cooperative Societies Act, 1991, "Area of operation of a Society" means a registered boundaries where membership is drawn. "Balance Sheet" means a statement of assets and liabilities drawn at a specific date. "Budget" means and includes a projection of income and expenditure statement approved by the members at the general meeting. "Chief executive" means an officer of a Society vested with the powers to manage and supervise all the day to day affairs of a Society. "Cooperative Officer" means an officer of the Cooperative development division of the Ministry for the' time being responsible for matters relating to Cooperative Societies. . "Court" means district court or a court of a resident magistrate having jurisdiction over the area in which the headquarters of the society are situated, "Department" means the: Cooperative department headed by the Regis­ trar. "Formation committee" means a committee elected under the provisions of rule 3. 871 Co-operative Societies Rules G.N. Nil. 408 (contd.} "Management committee" means a•.committee elected by members at a r;eneral meeting. "Prescribed" in relation to forms, means prescribed by-regulations made under section 124 of the Act and ill relation to fees, means prescribed under these Rules. "Scheme" in this context means a system established by members to facilitate financial operations as prescribed in tbe By-laws of a Society. "Supervising manager" means an Officer appointed/elected by the man­ agement committee of a society. PART II FORMArIO:\ OF SOCIETIES Initial meeting and elec­ tion of ~. formation commit­ tee Function a forma­ tion Com­ mittee 3.-( I) Persons interested in the formation of a Cooperative Society either primary or joint enterprise. secondary, apex or federation shall meet under the chairmanship of the local Cooperative Officer or any other Cooperative Officer appointed by the Registrar for that purpose of electing a formation committee (2) Formation committee shall not be less than the minimum number of members required to form a Society. U) Each fnrmati ..n committee shall elect a chairman and appoint a secretary and shall maintain a record of its proceedings. 4. The function of a formation committee shall be: (a) To consider in detail the type of society to be formed and to determine its objects. (h) To assess the probable membership and expected volume of bus­ mess. (c) To undertake. with the assistance of the Cooperative Officer and. where necessary, with any person with a relevant technical skill. a feasibility study into the economic and practical aspects of the activities to be carried out by the proposed society. (d) To prepare. a viability statement or Project write up for submis­ sion to the Registrar. 872 Co-operative Societies Rules (e) To compile a list of prospective members and a record of the probable share capital or contributions. (f) ~o prepare, in consultation with the Cooperative officer approp­ nate By-laws for the proposed society, and (g) To do a!1 su:ch acts as may ?e ne.cessary for the purpose of making an application for the registration of the proposed society. PART III REGISTRATlON OF SOCIETIES 5 -(1) Every society applying for registration must comply with the provisions of section 29 of the Act and shall submit an application to the Registrar in the form prescribed inthese Rules. (2) Every application for registration of a Cooperative society shall be signed on its behalf by persons duly elected by the formation. meet­ ing: (a) Certified copy of such resolution shall be attached to ~he applica­ tion. (b) For copies of the By-laws which the society proposes to adopt shall be submitted together with the application. (c) Four copies of the viability statement or project write-up referred to in rule 4(d) shall be submitted with the application. (3) Where the Registrar registers the application he shall return to the society: (a) One copy of the By-laws and application for registration stamped with his official seal together with the certificate of registration. (b) One copy of the viability statement or project write-up duly stamped as approved. (c) One copy of income and expenditure contained there in to rep­ resent the first estimates of the society and shall be so treated. Registra­ tion of so-» ciery 6. In order to determine whether the proposed society is economically Registrar viable or otherwise the Registrar may prescribe one or more of the may re­ following requirements before registration. qUIre ad­ ditionai (a) require­ That additional information be provided to show whether the ment be proposed society meets and economic social or cultural need, fore regis and has reasonable prospects for echieving its objects. tration 873 Co-operative Sa<"ietie,\' I<II/e.\ (;. N. No . .Jf/8 (mIlM.) (h) That the applicants for registration obtain support from more persons who may he expected to become members. (c) That more capital be furnished initially by the applicants for registration and other persons expected to become members, and that such additional capital be sufficient for the commencement of the operations. (d) That arrangements be made for more educational and advisory work respecting cooperative principles and practices and the ob­ jects of the proposed society among the applicants for registra­ tion, and among other persons who may he expected to become members. (e) That there he sufficient respecting the availability of officers cap­ able of directing and managing the affairs of (he proposed society and of keeping proper records and books of account as prescribed hy the Registrar under the Act, and that if necessary, such officers he required to undergo such additional training as the Registrar deems necessary. Procedure for refusal to register a Societv Member­ ship of so­ ciety 7. Where the Registrar refuses to register a society or its By-laws he shall record in writing his reasons for doing so. PART IV RI(;IITS, LIABILITIES AND PRIVILEGES OF MEMBERS 8. Members of a society shall consist of: (a) Persons who join in the application for registration of a society. (h) Persons admitted in accordance with the By-laws of the society. (c) Persons who have attained the age of eighteen and of a sound mind, are following relevant trade or occupation relevant to the society's objectives, they have a common need which the society seeks to satisfy and are capable of paying fees and acquiring shares. (d) Persons who have not attained the age of eighteen years but have attained the age of fifteen referred to as minors may join a Cooperative Society in accordance with subsection (3) of section 14 of the Act. R74 Co-operative Societies Rules G.N. No. 408 (contd.) 9. Members shall have the following rights: (a) Rights to vote and to be voted form right to attend meetings and to participate in the leadership of the society, right to call a meeting in accordance with these Rules and By-laws. (b) No member of a registered society shall exercise the right of a member unless or until he has made such payment to the society in respect of shares, entry fees, and any other dues. (c) Each society may limit the number of its members in relation to its activities and in accordance to section 14 and 22(2) of the Act. (d) No company incorporated or registered under the companies Ordinance and no unincorporated or registered body of persons shall be entitled to become a member of a registered society except with the written permission of the Registrar and subject to the following conditions: (i) Unless such company or body has shown interest to make use of services of the society and the Registrar is satisfied to such move. (ii) The membership of such company or body shall comply with the Act, Rules and By-laws of the society. (iii) The society shall benefit from the services of such company. 10.-(1) A minor may be a member but where parent or guardian of such a minor is informed of his desire to become a member he shall open a share account or pay a membership fee, and buy shares as the case may be. (2) Where the parent or guardian has been informed of a share or deposit account held by a minor and no restrictions on the account are imposed by the society, a minor may make payments to and withdraw money from such account, or make such other use of the account as deemed desirable without the approval of his parent or guardian. (3) A minor who makes use of the services of the society in accordance with sub-rule (1) or (2) shall have the rights of a member except the right to vote. (4) Provided that the provision of this rule shall not apply in the case of school society. 11. ~very member admitted after the registration of the By-laws shall have hIS nam~ entered ~n the register of members and shall sign his name or affixhIS thumbprmt to such entry in the presence of two members of the committee. 875 Right of members Rights of minors Entry of member's name in register With­ drawals from member­ ship Co-operative Societies Rules G.N. No. 408 (contd.} 12.--{1) A member may withdraw from the society upon giving such notices as may be required by the By-laws or such additional notice as the committee may deem necessary in any particular case. (2) Without restricting the generality of the foregoing, additional notice may be required if the member is a borrower or guarantor of a loan owing to the society, or is otherwise indebted to the society. (3) No member withdrawing shall be entitled to a refund of his entr­ ance fee. Vote of members Nominees Termina tion of member­ ship 13. At general meetings and in the affairs of the s~iety each individual member present shall have one vote only irrespective of the number of shares held by him and no proxies or representative of such member shall be allowed. 14.--{1) Every member of a society may at the time or after he becomes a member nominate in writing with two attesting witnesses, one person who, in the event of his death, will succeed to his shares or other interests in the society, and such nominee may apply for member­ ship. (2) In the event of such nominee not becoming a member or not being admitted to membership by the committee the value of the shares or other interest shall nevertheless be paid to him in accordance with sub-rule (4). (3) In the event of such nominee dying or of the member desiring to cancel such nomination, the member may from time to time nominate in writing another person in the same manner as in sub-rule (1), and the necessary alterations shall be made in the records of the society. (4) For the purposes of a transfer to the nominee, or to the legal representative if there is no nominee, the value of any shares or other interest shall include the sum actually paid to the society by the member or credited to his share capital or other account from time to time out of the earnings of the society in accordance with the By-laws. (5) The value of the interest of a member who has become of unsound mind and incapable of managing his affairs shall be ascertained and paid or transferred to a nominee of the unsound mind member to whom such interest shall vest. 15. Membership shall be terminated:­ (9) In accordance with the By-laws, (b) Upon the member's death, (c) Upon the member's ceasing to hold a share or shares and any contributions as required by the By-laws of a society, 876 Co-operative Societies Rules G.N. No; 408 (contd.} (d) Upon the member ceasing to be a resident of the area of operation of the society, (e) By expulsion, (f) For failure to j'M,rticipate in the economic activities of the society .'quired by the By-laws, (g) Upon a member becoming of unsound mind, (h) By withdrawal. 16.-(1) Save as is provided by paragraph (2), a member may be suspended or expelled: (a) Upon his conviction of a criminal offence involving dishonest or a sentence of imprisonment for six months or more, (b) For giving or tendering any gratuity or commission to anyone employed by the society, (c) For any action which may be held by the committee and a general meeting to be dishonest or contrary to the stated objects of Co-op­ eration, (d) For failure to pay any sum due from him to the society within the period allowed, (e) For any other reason specified in the By-laws. (2) Sub-rule (1) shall apply to any member or delegate of a co-opera­ tive society. (3) For the purposes of sub-paragraph (a) of paragraph (1) of this Rule, the ordinary.date on which the period allowed for making an appeal against, a conviction or sentence, as the case may be expires or, if such appeal is made, the date on which the appeal is finally desposed of or is abandoned shall be deemed to be the date of the conviction or sentence, as the case may be. 17. Shares may be held and deposits may be made in a society by a duly authorized person on behalf of school society or other junior organi­ zation, and withdrawals may be made on behalf of such society or organi­ zation with the written approval of the person authorized to hold shares or made such deposits. .J.u. r'1 Ul""l.lIU'"'l VJ. Q 13V""1~LJ .31UU.l 1Ja.y~ }JI1UlILJ l1J l~""~IYJUO"U""l1"~lYl""~" .•nd any other privileges as may be provided for in the By-laws of the society. PART V DUTIES OF REGISTERED SOCIETIES 19. Every society shall maintain a register of members showing:­ (a) The name, address and occupation of each member, and a state­ ment of the number of shares held bv him, 'd77 Suspen­ sion or ex­ pulsion of a member Shares and de­ posits may be made on behalf ofaschool to receive services in priority Register of mem­ bers Publica­ tion of ba­ lance sheet Co-operative Societies Rules G.N. No. 408 (contd.) (b) The date on which each member's name is entered in the register, (c) The date on which any member ceased to be a member, (d) The nominee, if any, appointed under Rule 14. 20. Every society shall exhibit its annual balance sheet during office hours to any person interested in its funds as a member, depositor or creditor. Annual State­ ments Copies Disputes Cap. 15 21.-(1) The committee of every society or some officers of the society appointed for this purposes hy the committee, shall prepare in such form and for such period as the Registrar may direct: (a) An account showing the income and expenditure or an account of like nature acceptable to the Registrar, (b) An appropriation account, and, (c) A balance sheet. The accounts shall be made up to the last day of the period to which they relate, and a copy thereof shall be sent to the auditor not later than three month after the closing of the financial year and auditors shall complete the auditing work within two months. (2) Accounts of every registered society shall be audited at least once in a year by the Co-operative Audit and Supervision Corporation or a competent registered auditor who may charge a reasonable fee. The appointment of a competent and registered auditor be reached at a general meeting of members and is subject to the approval of the Regis­ trar. (3) (a) Registered society may make annual contribution through its net surplus to a fund to be known as the Audit and Supervision Fund established for the purposes of audit and supervision of existing societies the administration of which­ shall be prescribed by the Registrar. (b) A general meeting of the society may fix the amount of 22. For the purpose of section 59 of the Act, a copy of any entry in the book of society may be certified by a certificate written at the foot of such copy declaring that it is a true copy of such entry, and that the book containing the entry is still in the custody of the society. Such certificate shall be dated and signed by the secretary of the society or officer approved by the Registrar. 23.-(1) Any dispute concerning the business of a cooperative society between the members of the society or persons claiming through them, or between a member or persons so claiming and the committee or any officer, or between one society and another shall be referred to the Registrar. Reference may be made by the committee or by the society by resolution in general meeting or by any party to the dispute, or if the dispute concerns a sum due from a member of the committee to the society, by any member of the society. (2) The Registrar may either decide the dispute, himself or refer it to-arbitration under the Arbitration Ordinance. 878 Co-operative Societies Rules c:V .\in. -IW, (UJ/I/(I.) (3) In any case of doubt as the interpretation of the By-laws of the society the matter shall be referred to the Registrar for decision. (4) A person aggrieved by a decision of the Registrar under paragraph (2) or paragraph (3) may within fourteen days of the receipt thereof appeal in writing against such decision to the Minister whose decision shall be final. (5) In the event of conflict between the By-laws of a secondary society and the By-laws of a primary society which is a member of such secondary society, the By-laws of the secondary society shall prevail, and in the event of a conflict between the By-laws of an apex society and the By-laws of a secondary society which is a society shall prevail, in the event of a coflict between the By-laws of apex society and the By-laws of a federation of apex societies, the By-laws of the federation shall prevail. (6) In the event of conflict between the By-laws of a joint enterprise and the By-laws of a primary society which is a member of such joint enterprise the By-laws of the joint enterprise shall prevail. In the event of conflict between the By-laws of a joint enterprise and the By-laws of apex society which is a member of such joint enterprise the By-laws of the joint enterprise shall prevail, in the event of conflict between the By-laws of a joint enterprise and the By-laws of a federation of apex societies which is a member of such joint enterprise the By-laws of the joint enterprise shall prevail. 24. The Registrar shall gradually delegate his duties of promoting. advising, educating and training of Co-operative Societies to the Co­ operatives on mutual agreement according to section 12 (2) of Act, when such Co-operative Societies have attained the following qualifications: (a) Have employed competent staff to administer the affairs of the society, (b) Have instituted sound internal control system to safeguard prop­ erty and finances of the society, (c) Have attained adequate internal financing system and not very much depending on external loans, (d) Have cleared themselves of all previous debts from their creditors especially bank overdraft, (e) Have committed members who fully participate in the affairs of the society, (f) Have sufficient turnover of business to cover all the costs and earn adequate revenue to facilitate operations of the society, (g) Have capability of paying patronage dividends and bonuses to its members, (h) Individual projects run/operated by the society must be self-sus­ taining, (i) Capable of producing current audited financial statements within six months from he closure of the financial year. U) Have produced favourable audited results from operations and for three consecutive years and have been able to pay honorarium/ bonus. 879 Delega­ tion of duties 01 Registrar First gen­ eral meet­ ing Annual general meeting General meeting Co-operative Societies Rules G.N. No. 408 (contd.) Subject to the provisions of the above conditions each society shall be graded on its own merits and shall be granted with gradual delegation of duties of the Registrar accordingly. PART VI MANAGEMENT OF SOCIETIES (a) General Meetings 25.-(1) Unless otherwise provided in the By-laws, every society shall within two months from the receipt of the certificate of registration, unless the time is extended by the Registrar, hold a general meeting at which all members shall be entitled to be present and vote. (2) The business of the first general meeting shall include the election of a Chairman, Vice Chairman and a managing committees. (3) The managing committee shall elect from amongst themsleves a sub-committee provided that in case of savings and credit society such sub-committee shall be elected by the general meeting. 26. Every society shall hold an annual general meeting of its members or delegate in every calender year as prescribed in the By-laws: Provided that such meetings shall, unless otherwise approved by the Registrar, be held within six months of the close of the previous financial year of the society. 27.-(1) Every society shall hold a general meeting for the disposal of necessary business including: (a) The election, suspension or removal of members of the commit tee. (b) The consideration and adoption of the annual balance sheet. (c) The disposal of sums available for distribution, (d) The amount of honoraria, if any. [or unsalaried officers and committee members, (e) The acquisition or disposal by the society all immovable property and of movable property of a value in excess of ten thousand shillings in the case of a primary society, twenty thousand shillings in the case of a secondary society, five hundred thousand in the case of apex society and one million shillings in the case of the fede ration of apex societies. (f) The approval of the annual budget. (2) The procedure for election ot committee members shall be as follows: (a) Nomination of candidates shall he done by show of hands at the annual general meetings. (b) The candidate so nominated shall get me support of some of the members present at the meeting. (c) Voting shall be done by secret ballot. (d) Counting of votes shall be done immediately after election and results shall be announced by the chairman. 880 Co-operative Societies Rules G.N. No. 408 (contd.) (3) Every society shall hold general meetings at least two times in a year except that the federation shall hold general meetings at least once in a year. (4) The Registrar or any person authorized by him may summon and preside a special or general meeting of the society in such manner and at such time and place as he may direct. He may also direct what matters shall be discussed at the meeting. Such meeting shall have the powers and subject to the same rules as a meeting called in accordance with the By-laws of the society. All expenses for the meeting shall be met by the society. (5) A special meeting shall be held by a society where at least one third of member signify in writing the intention to hold such meeting. 28.-(1) A notice of a least twenty one days in the case of an annual general meeting, fourteen days notice in the case of an ordinary general meeting and seven days notice in the case of a special general meeting, shall be given whether by advertisement, mail or otherwise. (2) The notice shall contain a statement of the purpose of the meeting and, wherever paracticable, the agenda for the meeting shall be made available to each member or delegate before the meeting is held. (3) The non-receipt by a member of a notice or information respecting the date, hour and place of meeting shall not invalidate the proceedings or the business transacted at the meeting. 29.-(1) The By-laws shall prescribe the quorum at a general meeting of a society: Provided that in the case of primary Co-operative society the number to constitute a quorum shall not be less than one hundred members or fifty percentum of all the members which ever is less. (2) Where the.By-laws of a society do not prescribed a quorum, the quorum at a general or special meeting 'of a society shall be one half of the members or delegates, as the case may be entitled to attend and to vote. 30.-(1) Except as provided in sub-rule (3) or Rule 1; respecting minors, each member who has complied with the provision of the By-laws respecting admission to and maintenance of membership in the society or delegate shall have one vote at a meeting of the society. (2) Voting at all elections shall be by secret ballot. (3) A resolution put to the vote of the meeting shall be decided by a show of hands unless a poll is demanded by at least three members or delegates present. (4) In the event of equality of votes in the meeting of committees, the Chairman shall have a casting vote. In the event of equality of votes in the general meeting the agenda shall be postponed or cancelled. 881 Notice of meeting Quoram Voting Co-operative Societies Rules G.N. No. 408 (contd.t Minutes of general meetings Manage­ ment Commit­ tee Eligibility of mem­ bers Cir­ cumsta­ nee which member of com­ mittee ceases to hold office 31.-(1) All business discussed or decided at a general meeting shall be recorded in a minute book which shall, on confirmation, be signed by the chairman of the meeting and the secretary. (2) Unless the Registrar otherwise directs, societies shall send copies of the minute certified in the manner specified by rule 36 to the Registrar. (b) Management of Societies 32. Subject to the provisions of the Act, members of the management committee shall be appointed, suspended or removed only by the major­ ity which constitutes more than (~'2) half of the members present and voting at a general meeting. 33.-(1) No person who is not a member of a society shall be eligible for appointment as a representative of such a society, at any meeting or of any committee of any secondary society, apex society or federation of which the society may be a member. (2) No person who is not a member of a society shall be eligible for appointment: (a) To the committee of the society, (b) To the committee of any secondary society, or federation of which the society may be a member, (c) As a delegate to represent the society, or (d) To the' committee of a Co-operative joint enterprise, if such person: (i) Holds any office of profit under his society or such joint enterprise secondary a society, apex society of federation or receives any honorarium from either of· such societies except in accordance with the Act, (ii) Where either his society or such secondary society is a credit society, lends money on his own account, (iii) Where either a primary society or such a joint enterprise secondary society or apex society is a trading society, deals in the same class of produce in which one of the societies deals, (iv) If such a person fails to fulfil task targets set for every member of the society for the preceding year. 34.-(1) A member of the committee shall cease to hold office if:­ (a) He ceases to be a share holder, or (b) He becomes of unsound mind, or (c) He is convicted of any offence involving dishonest or is sentenced to imprisonment for three months or more, or (d) He accepts any office of profit under the society or receives any honoraria or any other payment except in accordance with pro­ visions of the Act, or (e) In a credit society, he lends money on his own account, or (f) In a trading society, he deals in the same class of produce in which the society deals, or 882 Co-operative Societies Rules G.N. No. 408 (contd.) (g) He ceases to be a member of the society, or (h) Heseeeses to be a member of the primary society which he rep­ resents in the secondary society... (i) He voluntarily resigns his office. (2) The provisions of paragraph (2) or rule 14 shall apply in respect or sub-paragraph (c) of paragraph (1). .35. Payment of the honorarium to the committee of a registered Co­ operative society shall be determined and approved by the Annual gen­ eral meeting of the members provided that the Liquidity position of the society allows payment of such honorarium. 36. The duties of the committee shall include. inter alia. the follow­ mg: (a) To comply with the provisions of the Act and the rules and regulations made there under. and the by-laws of the society. (b) To lay down financial regulations and maintain true and accurate accounts. (c) To keep a correct register of members. (d) To lay before the annual general meeting an audited income and expenditure account balance sheet and sources and application of funds. (e) To facilitate the inspection of the books by any person authorized to inspect them. (f) In a credit society, to ensure that loans are applied to the approved purpose for which they were made and that proper securities have been taken for any loans made in accordance with the by-laws. (g) In a trading society. to ensure that the by-laws or the contracts binding members to deal the society are observed. (h) To arrange for appointment of employees and staff or a society and their terms of service. 37. Where a supervising Manager is appointed he shall be vested with powers to perform the following duties: (a) Supervising day to day activities of the society performed by his subordinates. (b) Preparing Scheme of Service of staff and employees and present for approval to the Managing Committee and ultimately to the General Meeting. (c) Answerable Jtl) the Management Committee of the Society, (d) Preparing a regular progress report at intervals as specified by the Management Committee including assets and liabilities. (e) Preparing annual accounts and balance sheet for submission to the Management Committee and auditors. (f) Ensuring the maintaining of proper books and records of business including assets and liabilities. Hvn­ orarium lIf pay­ ment to commit­ tee member Duties Commit­ tee Duties of supervis­ ing man­ ager Bank Ac­ count Commit­ tee mi­ nute book Addi­ tional functions of com­ mittees in savings and Cre­ dit societies. Co-operative Societies Rilles G.N. No. 408 (contd. J (g) Dealing with purchase of shares issue of shares certificates to members, (h) Keeping in safe custody all moneys and other instruments, (i) Acting as a secretary to all meeting, U) Maintain a correct register of members and their shares, (k) To countersign contracts and agreements on behalf of the society, (I) To perform any other duties as instructed by the Managing Com. mittee. 38. The savings and credit society shall have the following commit­ tees: (a) Management committee which shall be responsible for managing the day to day affairs of the society. (b) Credit committee which shall have the responsibilities of super­ vising all the loan activities, (c) Supervisory committee which shall be responsible for examining the affairs of the society at least once in every three months. 39.-(1) The committee shall open a bank account with the assistance of Co-operative Officer. (2) All cheques shall be signed by two members of the committee, the committee shall appoint signatories provided that one of them is a secretary or manager of the society. 40. All business discussed or decided at a meeting shall be recorded in a minute book which, shall be signed by the Chairman of the meeting and such other persons as the by-laws may require. Objects and Func­ tions of Co-opera­ tives 41.-(1) In order to carry out the objects of different levels of Co­ operative Societies as provided under sections 17, 18 and 20 of the Act those objects shall apply to the secondary societies, apex societies and the federation respectively as their functions. (2) Without prejudice to the generality of the foregoing the secondary society shall have the following functions: (a) To provide services to primary societies as will be provided in the by-laws of the secondary society. (b) To facilitate operations of primary societies which are its mem­ bers: (c) To procure and sell their products as may deem necessary. (d) To procure and distribute agricultural inputs to its member prim­ ary societies. (3) Functions of an apex society shall be: (a) To facilitate the operations of secondary societies. (b) To provide services to secondary societies. (c) Organizing and Co-ordinating activities of secondary societies. (d) To render services designed to ensure efficiency and uniformity in the conduct of the business of its member societies, standardiz­ ing their book keeping, accounting and other procedures and providing audit service" to those societies. 884 Co-operative Societies Rules G.N. No. 408 (contd.) (e) To reduce operating costs by arranging for group bonding of Co-operative Society employees and making bulk purchasing of book-keeping stationery and other supplies for sale to its .nem­ bers, (f) Print, publish and circulate any newspapers or other publication designed to foster or increase interest in Co-open~ive Enterprises, principles and practices, (g) To represent its members societies in collective bargaining, (h) To provide consultative services to member societies, (i) To do any other thing which in its opinion is connected with br is anciliary to the above enumerated objects. (4)" Functions of the federation shall be: (a) To provide, organize and supervise effective centralized services for the member societies and for Co-operative education and training and such other services as may be necessary or expedient for its members. (b) To co-ordinate the economic plans of the member societies and to forward them to the Minister for incorporation in the national plans', (c) To formulate, maintain and regulate the terms and conditions of services of persons employed in the apex societies, secondary societies and such other registered societies, (d) To carry on, to encourage and assist educational and advisory work relating to Co-operative enterprise, \e) fo advise the government on co-operative education and operat­ ing methods and for that purpose and may prepare and provide correspondence courses regarding Co-operative principles and operating methods and may disseminate information on Co­ operative principles and practices. (f) To represent its member societies in international conrerences (to be the Chief spokesman of the member societies and represent its member societies in international conferences). (g) To print stationery for the use of Co-operative Societies. (h) To establish a department to perform function of (i) Establishment of joint negotiating machinery with regard to the remuneration and conditions of service of officers of the federation. (ii) Giving advice to employing Societies regarding the training of officers of the society. . (iii) Eitablishment management and control of any provident fund, . superannuation fund or pension scheme. (iv) Interviewing and selection of candidates for awards under train­ ing schemes and the Co-ordination of arrangement for courses of training, (v) Co-ordination of arrangement for the setting of promotional examinations for prospective officers of the organization. 8&5 Co-operative Societies Rules G.N. No. 4()8 (contd.) (i) To give such advice and make such recommendations to the Minis­ ter as it may think fit regarding (i) Which the Minister may refer to the federation for its advice; or (ii) Which affects the interests of Co-operative societies. (j) The Federation may with the consent of the Minister make regu­ lations relating to any of its functions, as stipulated above and such regulations may: (a) Be expressed to apply to all officers of the federation or to any category or group of such officers. (b) Prescribe such terms and conditions of services and provide for salary scales the payment of allowances and gratuities, the grant of advances, promotion, the interdiction of officers, the termination or appointments, dismissals. leave and any other matters relating to the federation discipline and welfare of officers of the federation. (c) Prescribe anything that may be or is required to he prescribed under these Rules. (k) To do any other thing which in its opinion is connected with or is anciliary to the above functions. PART VII PROPERTY AND FUND OF REGISTERED SOCIETIES Funds 42. The funds of a society shall be devoted only to the promotion of the stated objects of the society. the running of the society and such other purposes as are set out in the Act, these rules and the By-laws of the society. Limit of 43.-(1) Every society shall from time to time tix, at a general meeting, Loans the maximum liability which it may secure in loans or deposits from non-members. The maximum so fixed shall be subject to the approval by the Registrar. No society may receive any loan or deposits from a non-member which will make its liability to non members exceed the limit approved. (2) Without prejudice to the generality of sub-rule (1) every society shall transact its business in accordance to section 71 AI), (2), (3) of the Act. (3) There shall be a Central reserve Fund to be established by the federation of apex societies which shall be contributed to by respective member societies. The fund shall be administered in such a manner as the Minister may from time to time direct and according to the regulations made therefore by him/her. 886 Drstribu­ tion of net balances Co-operative Societies Rules G.N. No. 408 (contd.) 44.-(1) Every society shall, unless the Registrar other wise directs, Estimates submit for his approval an estimate of income and expenditure in such of income detail as he may require for the next ensuing financial period. Such and ex­ estimate shall be submitted not later than one month before the com- penditure mencemcnt of the period to which the estimate relates. (2) A society shall not incur expenditure exceeding that provided in the estimates except with the approval in writing of the Registrar. 45-( 1) No member of a society shall guarantee a loan by the society Guaran­ to any other member where such other member has guaranteed a loan tors by the society to the first-mentioned member. (Example:- "A" has borrowed a loan of Shs. 100/- from the society and "S" has guaranteed repayment "B" wishes to borrow a loan from the society, "A" shall not be accepted as a guarantor of "B"s' loan). (2) A guarantor shall be liable for the repayment of the loan for which he is a guarantor to the same extent as the guarantee and in the case of default of payment ~)f such loan by the guarantee, he shall be liable to repay such loan. (3) Every loan shah be guaranteed by at least two guarantors. (4) Security for loans shall be prescribed in the by-laws of each society. 46. Subject to section 81 of the Act, the annual net balance together with any sum available for distribution from previous years, after the required provision has been made shall be applied as .follows (i) Not less than 20% of the surpluses retained in anyone year shall be carried to the Statutory Reserve, lund. (ii) Such amount not exceeding 10% of the net surplus retained in anyone year as may be necessary to maintain the share Transfer Fund at a level equal to 1O(7~ of the subscribed share capital, shall be.set aside for this purpose. (iii) The payment of interest on share capital shall be determined from time to time by the members. (iv) The payment of dividend or bonus or any part of its accumulated funds shall be made after the balance sheet has been audited by a duly authorized auditor and approved by the general meeting. (v) The remainder may then be disposed of as decided by the general meeting (a) A contribution to a building or other fund. (b) By contribution to any charitable educational, medical or other purpose in accordance with the provisions of section 82 of the Act. (c) In the payment of honoraria to Committee Members and other unsalaried of any society. (d) In any other way approved by the general meeting and undis­ tributed balance shall be carried forward to the following year. 887 Co-operative Societies Rules (2) Any withdrawals from the reserved fund, unless the Registrar otherwise sanctions, shall be made good from the next accruing available funds in the following financial periods. (3) Accumulated funds may be distributed to the members of a society with. unlimited liability and the maximum rate of dividend which may be paid by the societies as shall be determined from time to time at the general meetings of such societies. 49. The reserve fund shall be indivisible and no member shall be entitled to claim any specified share of it. Invest­ ment of reserve fund Indivisi­ bility of reserve fund G.N. No. 408 (contd.) Reserve 47.-(1) Unless the Registrar otherwise approves, not less than one 'Funds fifth of the gain or surplus resulting from the operations of a registered society in any financial year, after provision has been made for deprecia­ tion in the value of the society's property and for contigent liability for loss, shall be carried to reserve fund. (2) There shall be a share transfer fund formed and maintained to meet expenditure which may be incurred by the society in purchasing the shares of members whose membership has terminated with the con­ sent of the committe. 48.-(1) The reserve fund of a society may be utilized in thebusiness of the society or for capital expenditure, unless the Registrar otherwise directs. Applica­ tion of re­ serve fund on dissol­ ution 50.-(1) On the dissolution of a society the reserve fund shall be applied to discharging the liabilities of the society and to the repayment of share capital. (2) Any sum that may remain shall be deposited by the Registrar in a bank until a new co-operative society with a substantially similar area of operations is Registered, in which case it shall be credited to the reserve fund of the new society. The Minister may, permit any balance or portion of the reserve fund remaining after all liabilities have been met and share capital repaid to be divided amongst the share holders. Contract entered into by society Property of society 51. No society shall, except with prior Consultation in writing with the Registrar and with prior approval of general meeting enter into any contract in respect of work done for the society or goods supplied or services provided for by the society or receive rent for by hire of any asset of the society where the value of the subject matter or such contract exceeds on hundred thousand shillings in the case of a primary society or five hundred thousand shillings in the case of a secondary society or one million shillings in the case of Apex Society or two million shillings in the case of the Federation. 52. The property of a society shall consist of such movable and immov­ able property as the society may from time to time acquire. 688 Co-operative Societies Rules o.s. No. 408 (contd.} PART VIII SPECIAL PROVISIONS RELATING TO DIFFERENT CATEGORIES OF CO-OPERATIVE SOCIETIS (a) Agricultural Co-operative Societtes (i) General Provisions: 53.-(1) All economic activities in an agricultural Co-operative soci­ ety shall be under the general guidance of the management committee to ensure that they are being run with maximum efficiency. (2) Management committee may set up sub-committee as it deems necessary for the purpose of performing its functions. (3) The general meeting shall determine the number of members of committee in accordance to section 63 of the Act. 54. Every Management Committee shall observe the objectives of agricultural Co-operatives as provided under section 4 ofthe Act particu­ larly it shall be operated democratically on the basis of principles, methods and procedures of Co-operation. It shall, thus strive to satisfy the cultural needs of its members and increase their social and political awareness. It shall improve the meterialliving conditions of its members and promote Co-operative education among its members. 55.-(1) Subject to availability of productive factors the management committee shall ensure that every member of the society is alloted with production facilities and inputs. (2) Production inputs and facilities shall be subject to overall control of the management committee of the society. 56. All heavy agricultural machinery and other capital goods acquired by the society shall be owned by the society through the Management Committee. Individuals may use such machinery or goods on their farms on condition to be determined by the General Meetings and as stipulated in the By-laws of the society. 57. The economic viability to be determined when feasibility study is made for the purpose of registration shall include the statement of: (a) Potential Members of common bond and felt needs to establish a Co-operative Society. (b) Potential Members ability to buy shares and make contribution in order to raise enough initial Capital for the purpose of sustain­ ing the basic cost of running the society. (c) Potential Members background and skills they possess. (d) Potential capacity of management to organize and control the affairs of the society. (e) Potential business volume of the Society to enable continuous Operations without losses. (f) The minimum required infrastructure and supporting services whether available within the area of operation of the society. 889 Economic activities be under the gui­ dance of the man­ agement commit­ tee Objec tives of Agricul­ tural' Co­ operatives Alloca tion of produc­ tion fac­ tors Owner ship of property of society Matters to be in­ cluded in feasibility study Co-operative Societies Rules G.N. No. 408 (contd.) Manage­ ment commit­ tee mav Establish' scheme Powers of society to made By­ laws Persuns with spe­ 6al skills may from Co-op. society Speciali­ zed Co­ operative to operate according to the Act. Rule and By­ laws 58.-( I) An agricultural Co-operative society may establish a scheme for its members to facilitate payment of cash crop through pass-book system and agricultural credit facilities such as inputs etc. (2) Members of such agricultural Co-operative societies wanting to establish the scheme shall apply to the Registrar for permission to estab­ lish the scheme. 59. A society shall made By-laws in respect of the following matters­ (a) Its name, (b) The area in which the operations of the society will be conducted and from which membership will be drawn, (c) The objects for which the society is established, (d) Qualifications for membership, the terms of admission of mem­ bers and the mode of election, (e) Withdrawal and expulsion of members and the payments, if any, to be made to such members, (f) The nature and extent of the liability of members, (g) The consequences of default in payment of any, (i) Its funds and the method of raising funds, U) General meetings the procedure at such meetings, powers of such meetings, and representation and voting at such meetings, where necessary, (k) Appointment suspension and removal of members of the commit­ tee and officers and the powers and duties of committee and officers, (I) The disposal of accumulated funds, (m) The authorization of an officer to sign documents on behalf of the society. 60.-( 1) Persons with special skills may from a Co-operative society. (2) For the purpose of this Rule every Co-operative society other than agricultural Co-operative society, industrial Co-operative society, Savings and Credit Society, Service Co-operatives etc. shall be regarded as specialized Co-operatives formed by persons who possess expertise in a particular field termed as specialized skills. 61. Every specialized Co-operative society shall operate in accordance with the Act, Rules and its By-laws. 890 Co-operative Societies Rules 0 ..'11. No. 4(J~ i'"llf/t!l. ' 62. Every Co-operative society shall maintain its own funds as pro­ vided in sections nl) and 70 of the Act, (h) Joint Enterprises 63.-( I) Two or more societies may from a joint enterprise. (2) Every joint enterprise shall he formed for a single purpose only. (3) Where a joint enterprise is formed for two or more societies. the societies forming the joint enterprise shall from a committee for the purpose of managing the joint enterprise. 64.-( I) Where it becomes necessary, in the public interest that the activities of the joint enterprise he run by another institution or organ, or that it be run jointly with another Co-operative institution or organ the Registrar shall CUllSI.' a notice published to that effect in the Gazette lind serve on the societies forming that joint enterprise. (2) The societies shall. within thirty days make any representations if any, to the Registrar. (3) Where no objections or other representations are made, than the societies shall enter into an arrangement with the Co-operative institution or organ fur the purpose of handing over the activities of the joint enterprise. to that institution or organ. or for the purpose of entering into a joint agreement with that Co-operative institution or organ. as the case may be. (4) Upon finalization of the arrangements referred to in sub-rule (I) the Registrar shall cancel the rcgistranon oj the joint enterprise and shall register the ell-Operative institution or organ which takes over the activities of the joint enterprise or the new body which is formed for the purpose of running the enterprise j•ointly. (5) Any objections or representation may he made to the Minister whose decision shall he final. 65. No joint enterprise shall expand its activities without the approval of the Registrar, ~91 (.'0 .....x: ~•. i~\'C "'0" i &."Y ;,' UI~1n::.. :: it.- ·'w·; rlln<l~ SOdC:II'::' rn:.y frum ;ainr en­ tei!ll'i"l: .'\ ':l.i,t ':'ltl;rpr;st' llllay cease to operate in c('It::m l~·r!.rj ..-; n..: 'n ",A 1"=1 "J I.~. opcnuicn withlllll ('ern'li:.· ~;Ol) of Re!tislI;lr Co-operative Societies Rules G.N. No. 4()8 (contd.} Minister 66. The Minister may make regulations providing for conditions for to make forming joint enterprise, and for regulating their activities. regula tionsin re lation to joint en terprises to make By-laws Joint En­ terprises to make By-laws Fees for registra­ tion Permis­ sion to in­ spect docu­ ments etc. of joint enterprise Industrial society to specify products 67. The By-laws of a joint enterprises shall provide for (a) The name area in which the operations of the enterprise will be conducted and the area from which membership will be drawn. (b) The objects for which the enterprise is established. (c) The nature and liability of members. (d) Its funds and method of raising those funds. 68. The fees for the registration of a joint enterprise shall be as pro­ vided in the Schedule to these Rules. 69. Any member of the public shall be permitted, on payment of the prescribed fee, to inspect at the office ofthe Registrar any of the following documents in relation to a joint enterprise (a) The registration register, (b) The registration certificate, (c) An order cancelling the registration of a joint enterprises. (d) An order directing the liquidation of a registered joint enterprise. (e) the annual accounts of a joint enterprise in accordance with the rules. (c) Industrial Co-operative Societies. 70.-(1) An industrial Co-operative society shall, in its By-laws specify the products that it will be engaged in producing, preparing. processing or manufacturing including the means of expanding its ac­ tivities and generally the means of achieving the objects of the society. (2) The By-laws of an industrial society shall provide for a type of management system which in its opinion may facilitate the society to achieve its objectives. (i) Artisans, Craftsmen and contracting societies:­ May be registered with the following functions (a) Producting, preparing, adapting, processing and manufactur­ ing goods, wares and marchandise from materials of every description for sale or under contract. 892 Co-operative Societies Rules o.s. No. 408 (contd.) (b) Undertaking contracts or sub contracts by provision of labour and technical services, material, and equipment for land clear­ ance or reclamation, road construction, the construction of industrial plants, public utilities of facilities for the develop­ ment of natural resources, and for the maintenance of build­ ing, plants and sites and public utilities. (c) Pro~iding, all necessary materials, equipment, facilities and services enable members and their families to produce, pre­ pare, adopt or process goods, wares and marchandise in their homes either for individual sale by each member or for sale by or through the society. (d) Rendering services to its members as contractors or as produc­ ers, processors and manufacturer of goods wares and merchan­ dise which are ancillary to their operation or activities. (ii) Co-operative societies for producers of Natural Products to be registered with the following functions: (a) Purchasing, hiring or otherwise acquiring, maintaining and operating boats, motors, nets and other equipment to be used in group fishing by or each member on an individual basis and the marketing of fish and fish products. (b) Obtaining or providing equipment contracts and management services for the production and marketing of pulp wood, fuel wood, timber, lumber and other forest products delivered wholly or partially there from. (c) Subject to provisions of Mining Act 1979 obtaining prospect­ ing, exploration and mining licences and obtaining or providing equipment, contracts and management services for develop­ ment, utilisation and disposal of the products of any mine. (iii) BuDding, Constructions and Housing Societies: A building construction society may be registered for the following functions (a) Building houses and flats for individual or family use and other buildings for industrial business or public use, either for sale by the society itself or under agreement.negotiated with a local authority or other public body or authority performing a function of government or providing a public service or with a company, society, association, partnership or other organi­ zation or person. (b) Purchasing, manufacturing, processing or otherwise providing materials for the construction of building or constructing for architectural services or for the installation of utilities. 893 Co-operative Societies Rules G.N. No. 408 (contd.) (c) Making loans and advances to its member fur purchase of tools, materials and equipment for their individual usc in huild­ ing. A housing society may he registered with the principal functions of (i) Building or otherwise acquiring houses or flats for sale to its members for their individual ownership and use. (ii) Building or otherwise acquiring, maintaining and managing houses or flats for lease to its members. (iii) Acquiring site planning land for the construction of houses or blocks or fiats by and for its members. Object- of the soci­ cry to he stated in its By­ laws Evidence uf abilitv to meet contrac­ tual obli­ gation By-laws ot Societv to lay proce­ Jure for appreu rices 10 members of the SPc:­ icty By-laws of building societv to define te­ nancy contract Provision in the By­ laws of consumer Co-opera­ tive S,Ki­ ety 71. Every industrial Co-operative society shall in its By-laws state its objects, the amount of capital which is to be contributed. if any. and the manner of raising that capital. 72. Subject to the provisions of rule 51 where an industrial society has one.of its objects as entering into contracts for the supply of services it shall undertake and discharge the obligation of that contract and where the contract requires special skill it must furnish evidence that some of its members have the necessary skills required for the discharge of the contract. '13.-( 1) Every industrial society shall in its By-laws lay a procedure for enabling apprentices to he full members of the society. (2) In no case shall the labour force of non-member of every industrial Co-operative Society exceed on equater of the total labour force, without prejudice to the generality of sub-rule (2) labour force shall not include casual labourers. 74. By-laws of building society shall provide for the tenancy contract. (d) Consumer Co-operatives 75. A consumer society may be registered for the principal purpl1sc of purchasing. procuring, processing. manufacturing exchanging. hiring and dealing in goods. wares and merchandise including foods. clothing. household goods. fuel and other necessities of all kinds for individual or family consumption or use. as well as agricultural inputs for sale. 894 Consumer Co-opera­ tives tu set price pol­ icy Co-operative Societies Rules C.N. No . .J08 (conul.] A consumer Co-operative society may provide inits By-Iaws (a) That no member shall be paid on credit except with the prior approval of the managing committee, (b) That no member shall be paid in cash his patronage bonus if the member has not paid in full the minimum amount of share capitals as may be required in the By-laws of the society, (c) That members may be required without making individual con­ tracts to undertake to make loans to the society to the extent of the patronage bonus. 76. Consumer Co-operatives shall set a price policy as shall he de­ scribed in its By-laws. 77. No officer or employee of a consumer Co-operative society shall be allowed to act independently in all credit transactions. which shall be authorized by the management committee. (e) Savings and Credit Societies 78.-(1) A Cooperative Savings and Credit Society, in this part referred to as a credit society may be registered for the 'promotion of thrift among its members and the creation of a source of credit for its members at controlled rates of interest, exclusively for provident or productive purposes. (2) One or more of the words "Savings" and "Credit" shall form part of the name of every society registered exclusively for the purposes mentioned in Rule 78 (1). (3) The By-laws shall prescribe the common bond of occupation, association or residence to which membership of the savings and credit society shall be limited. 79.-(1) Savings and credit society so formed may request the employer to pay monthly salaries of its members through the society and in case of an agricultural or any other type of societies to pay members sales proceeds through the savings and credit society. (2) Where a savings and credit society is formed by persons who ate under one employer, employer may give the savings and credit society such supporting services as check off system and accounting. Where such employer defaults to remit deductions from members for a period of at list two months. an interest of 10% will be charged on the amount due to the society. 895 No officer to Act ill­ depen­ dently in credit t. ansae­ non Objects, name and common bond in a savings and credit society Employer or Ag­ ricultural Society to supply support ing ser vices to savings and credit society Service to member Oraaniza· lion Co-operative Societifs Rules G.N. No. «J8 (coNd.) (3) Agricultural Cooperative society shall continue to provide material support to savings and credit society such services as deductions at the source and office accommodation. SO.-{l) A savings and credit society may make By-laws and with the approval of the Registrar, provide for admission to membership of another credit society, or one or more organizations such as: (a) A local authority or other public body performing a function of Government or providing a public services, (b) A religious organization, (c) A labour organization, an agricultural organization or benevolent or fraternal organization, (d) An organization operated exclusively for charitable, educational or community welfare purposes, no part of the income of which is payable to or otherwise available for personal benefit of any proprietor, member or shareholder thereof. Provided: (i) That the By-laws shall specify the terms and conditions upon which such member credit society, other society or organization may obtain loans or otherwise services, (ii) That the total amount of loans made to such member credit society, other society or other organization shall not at any time exceed an amount equivalent to one quarter of the credit society. (2). Except with the approval of the Registrar no credit shall admit to membership another credit society or other organization unless their membership is drawn from the same general group as that composing the credit society. (3) A credit society shall require the committee or other elected officers of a registered organization which is a member in accordance with provisions of the rule to file with credit society a resolution authorizing the officers business with the credit society. (4) A savings and credit society shall require the authorized officers of an organization that is not registered but is a member in accordance with provisions of the Act, to furnish a resolution naming the officers who have authority to make withdrawals and to sign on behalf of such organization. (5) Except upon a resolution given to its signing officers a certified copy of which shall be filed with credit society, no loan shall be given to member organization which is not registered: Provided however that in the making of a loan to such organization which is a member of a savings and credit society shall in any particular case require such additional security by way of an endorsement of a negotiable instrument in the form of promisory note to repay the loan as may deemed advisable. 896 By-lawsto provide for ap­ pointment of com­ mittee Co-operative Societies Rules G.-N. No. 408 (contd.) (6) Loans to members other than natural persons the savings and credit society shall specify in the By-laws the services to be rendered to such members. 81.. The By-laws of a savings and credit society shall provide for the appointment of committees or sub-committee as are necessary for the efficient operations of the savings and credit society and shall provide in those By-laws as the constitution and duties of such committee or sub-committee. 82.-(1) (a) To receive the savingsof its members as shares, deposits, entrance fees, repayment of loans and interest on loans. (3) The Registrar shall review annually the borrowing powers of a credit society under sub-rule (2) and may at any time withdraw his approval of further borrowings under that sub-rule. (4) A credit society may with the approval of the Registrar charge, hypothecate, mortgage or pledge its immovable or movable property, rights and power, undertaking, franchises, book debts and unpaid call of the credit society, to secure any liability for the repayment of moneys borrowed under su-brule (2). 83.-(1) The number and value of shares may be determined by the By-laws. (2) Share in a savingsand credit society may be paid for by instalments at the times and in the manner determined by the By-laws. (3) The By-laws may require each member to subscribe for such minimum number of shares as may be designated in the By-laws: (4) After a number has paid his initial membership share and for such minimum number of shares as may be prescribed pursuant to sub-rule (3) he may, unless the managing committee decide otherwise continue to make payment for additional shares:. Provided that no member other than a registered cooperative society may hold more than one fifth of the shares of a credit society or such lesser amount as the By-laws may specify. (5) Moneys paid on account of shares may be withdrawn on application made in writing on any day when the registered office of a savings and credit society is open for business, but the managing committee may in any case require up to ninety days notice of intention to withdraw the whole or any part of such moneys. 84.~1) A member may deposit moneys in a deposit account in a savingsand credit society in such minimum amount as may be prescribed in the By-laws. (2) If permitted by the By-laws, a member may, by agreement with the society, deposit money in an account with a credit society for a stipulated term, for such minimum and maximum periods and subject to such other conditions as may be prescribed in the credit society. 897 Powers of a savings and credit society Shares in savings and credit society Member's deposits and with­ drawals Cu-ope'Qtiv~ Socieues Ru/~s U.N. Ne•• «JB (COftlII.) (3) Mon&.ys deposited by a member in a credit society for a stipulated term shall be in such amount as maybe agreed to by the credit society. (4) Mone~ paid for 011 account of deposits may be withdrawn on any day the credit society's office is open for business. The amount to be withdrawn at one time must be specified in the By-laws. Any amount exceeding the specified amount shall require a notice of thirty days in writing on the intention to withdrawn the whole or any part of such addition amount as may be specified in the By-laws: Provided further that if moneys deposited for a stipulated term pursuant to sub-rule (2) are withdrawn before muturity the rate of interest fixed in the deposit agreement may be discounted in such manner as may be determined and as may he specified in the deposit agreement (If the society. (5) No credit society shall accept deposits from a person who is not 3 member of the society. (6) The society ma~' ,'ay interest on deposus. The rate of interest shall be: determined by the general meeting. I..q~wjl t\5. Deposits may he :,~'·'·r!c:(; fl\'"1 n":I11I,\:p, ;If .1 ~ilvi"gs and credit ~-:'~k."C" under the following c"nditioll~: ( I) TIle savings and credit adopt the By-laws providing for the cohditions under which such deposit may be accepted. (2) The Registrar is satisfied thut the credit society (i) Has a permanent place "t business, (ii) Is adequately provided with safekeeping facilities for books to i~ individual members, (iii) Has adequate bonding and insurance coverage. (iv) Has adequate book-keeping system that is kept up to date, (v) Has the minimum amount of shares paid up. (vi) Has been authorized to use order negotiable by endorsement (cheque) with clearing arrangements with commercial banks, and (vii) Has appointed an auditor. Cll'lh re- 86.-{1) Every savinI!> and credit society shall maintain a reserve :.:n·Q fund to meet withdrawals of moneys in share and deposits accounts, consisting of cash on hand or in it b:lOk or other organization authorized By-law to accept moneys on deposit. and such reserve shall not at the end of any calender month he less than tcn pereentum of the liabilities of the credit society to its members in respect of shares and deposits at that time. Co-operative Societies Rules G.N. No. 408 (contd.] (3) Cash may only be kept on hand by a credit society. in accordance with the conditions respecting safe keeping facilities, insurance and other safeguards prescribed in these Rules and approved in the case of credit society by the Registrar. 87.-(1) A member may withdraw funds standing to his credit in share capital account or in deposit amount in the credit society, or place to his credit by the savings and credit society from the proceeds of a loan made to him by cheque payable to the member and issued by the credit society on or commercial bank or other depository in which the funds of the credit society are placed, provided that the necessary withdrawal voucher has been signed by the member. (2) Withdrawals may be made in cash by signing a cash withdrawal and disbursement voucher at the office of the credit society in a form designated by the committee and approved by the general meeting for use only at the office of the savings and credit society and containing the member account number, his personal signature, and initiated by the treasurer or his assistant when the withdrawal is charged to the members account or a stamp bearing the name of the credit society and the date may be used in place of an initial. (3) Withdrawal may be made by orders negotiable by endorsement (Cheque) where the general meeting has authorized the use of such orders and the society has arrangements for clearing. 88.-(1) Where a cash fund, other than loan petty cash for designated purposes as in rule 117 maintained for the purposes of sub-rule (2) of rule 87 and authorized by the committee with the approval of the Registrar, the following conditions shall apply: (a) Withdrawals from the bank or other depository for the stated cash funds shall be made only as required so that the amount of cash on hand shall not exceed at any time the amount authorized by the committee and approved by the general meeting. (b) The cash shall be kept in a suitable safe until required and shall be in the safe custody of the treasurer, secretary ­ treasurer or the manager as the case may be, provided that the Registrar may require such information as he deems necessary regarding the adequacy of safe-keeping facilities. (c) The credit and savings society has in force burglary and hold up insurance in an amount designated by the committee and approved by the general meeting. (2) Where the use of orders negotiable by endorsement (Cheque) has been authorized by the general meeting as in sub-rule (3) of rule 87 and to be issued by members on their deposit amount in the savings .and credit society, the conditions obtainable in rule 85 shall apply. 899 Methods of with­ drawal of shares and deposits Cash fund to meet withdraw­ als Co-operative Societies Rules o». No. 408 (contd.) No over- 89.-{1) No officer or employee of a savings and credit society shall draft al- permit any withdrawals of funds from share capital or deposit account, lowed or from the proceeds of a loan properly approved in accordance with the Act and placed to the credit of the borrower by the savings and credit society when the fund in such amount are not sufficient to cover the withdrawal. (2) The proceeds of any loan and payments therein together with the recovery from a member of any amount withdrawal in excess of the amount standing to his credit in his share capital or deposit account or loan account. Com­ mence­ ment of lending opera­ tions Loans by credit soc­ iety 9O.-{1) No savings and credit society shall commence lending operations until the minimum number of shares as .prescribed in the By-laws have been paid. 91.-{1) Every loan made by a credit society shall be for a provident or productive purpose. (2) Every application for a loan shall be on a form provided by the credit committee, and shall set forth the purpose for which the loan is desired, the security, if any, offered and such the information as may be required by the committee. (3) The credit committee shall enquire carefully into the character and the financialconditions of each applicant for a loan and his surerities or guarantors, if any in order to determine his ability to repay the loan and shall determine whether the loan applied for is for a provident or productive purpose and will be of probable benefit to the borrower. (4) Except for loans of such small amount as may be prescribed in the rules, the credit committee shall require security to be given on all loans and shalldetermine the particular security to be taken in each case. (5) An assignment of shares or of deposits or a negotiable instruments endorsed by a guarantor may be accepted as security for a loan. (6) The security for a loan shall be in the possession or within the control of the society before the loan ismade and where security covering immovable or movable property is required for the purpose of security the repayment of a loan, the proceeds of the loan shall not be made available to the applicant until all documents necessary to establish the claim of the credit society or the security in case of default have been duly executed and if so required, registered. (7) Notwithstanding the provision of subsection (6) the lending of money on mortgage of any description of immovable property shall be subject to the approval of the Registrar. 900 Co-operative Societies Rules G.N. No. 408 (conlll.) 92.--(1) Where more loan application are pending than can 'be Prefer­ granted by the credit society from the funds available preference shall ence in be given by the credit.committee the applicants' for the smaller loans in the grant-ing of the order received if the need for the loan and the security offered loans compare favourably with the need and the security offered with respect to application for larger loans. (2) Where;the By-lawsprovide for loans to a savingsand credit society or other societies or organizations, and where the By-laws provide for loans for business purposes and there are more loan applications pending than can be granted from the funds available preference shall be given by the credit committee to applications from individual members other than for business purposes. 93.--(1) No loan shall be made by the credit society if it would cause the borrower to become indebted to the credit society for an amount in the aggregate of all loans made by the credit society to the borrower in excess of eight percentum of its paid up capital; surplus and deposits, or in excessofsuch lesser percentage as may be provided in the by-laws. (2) Notwithstanding the provisions of subsection (1) the By-laws of a credit society may authorized the making of loans for amounts in excess of eight percentum of its paid up capital, surplus and deposits, to a local authority, or to a statutory body performing a function of government or providing a public service or to a society: Provided that the total of all loans made to all such borrowers shall not at any time exceed an amount equivalent to one quarter of its paid up capital, surplus and deposits. 94.--(1) Subject to its By-laws and having such minimum amount of paid up capital surplus, and deposits as prescribed in these Rules, a credit society may make loans: (a) For the purchase of farm land for the personal use of the borrower and for the purchase or erection of ouildings necessary for the conduct offorming operations on such1and, (b) For the purchase or erection of a dwelling house or other building for the house or other building are situated or are to be erected, (c) For the purchase or erection of building for use in the operation of a business of which the borrower is the sole owner or proprietor, whose total assets before the loan is made do not exceed such amount as shall be prescribed in the rules, (d) Where the borrower is a society, for the purchase or erection of a building required for the use of the society, whose total assets before the loans is made do not exceed such amount as may be prescribed in these .rules. Maximum loans to members Restric tion in making loans in certain cases Restric­ tion on loans to officers Total amount of loans for land. buildings and busi­ ness pur­ poses Co-operative Societies Rules G.N. No. 408 (contd.} (2) No loan shall be made by a credit society for financing the operation of business except for such purpose and under such conditions as shall be prescribed in these rules. (3) The total amount of loans made by a credit society in accordance with these rules shall not any time exceed an amount equivalent to one quarter of its paid up capital, surplus and deposits. 95.-(1) The total amount of loans made by credit society shall not at any time exceed an amount equivalent to one quarter of the paid up capital and deposits of the savings and credit society. (2) All applications for loans made require the approval by a majority vote of the following persons meeting together: (a) A majority of the members of the savings and credit committee, (b) Two or more managing committee members and (c) One member of the supervisory committee. 96. Where an officer of a savings and credit society applies for a loan in excess of the value of his shares and deposits assigned as security to the credit society, and the market value of any stock bond or security of the government of Tanzania held by him and so assigned his application shall require approval by majority vote taken in the absence of the applicant, of the following persons meeting together: (a) A mojority of the members of the credit committee, (b) Two or more managing committee members and (c) One member of the supervisory committee. Prohibi­ tions Un au­ thorized loans pro­ hibited Limita tion of loan Security for loan Rates of interest on loans 97. Subject to the provisions of Rule 80 no credit society shall lend money to or accept deposits from a person who is not a member of the credit society. 98.-(1) No officer or employee of a credit society shall lend money from the funds of the credit society to an applicant for a loan unless the application and the loan have been approved as required by this role. (2) An officer or employee who contravenes this section shall be guilty of an offence. 99.-(1) No credit society shall lend money to a person who is not member of credit society. (2) No loan shall be made to a member tor a period exceeding five years. 100. No person shall be advanced with a loan unleas hc-. furniIbot sufficient evidence that he will repay the loan. llll.-(l) The interest on loans by a savillll."di&= aba1l be fixed annualy by the general meetingauP approyal1iW!·1l: 9Cr) Co-operative Societies UII/n (;.\ So. 408 (contd.) Loans for business purposes 102.-(1) If the By-laws so provide, loans may be made by a savings and credit society for the purchases of land or the purchase or erection of building used in the operation of a business, or for financing the operation of a business of which the borrower is the sole owner or proprietor, subject to the following conditions: (a) That the combined amount of paid-up capital and deposits of the savings and credit society is less than such sum as may be provided in the By-laws of the society and as approved by the Registrar. (b) That a loan made for the purpose of this sub-rule and the total of any other loans made to the borrower shall not at any time exceed an amount in excess of eight percentum of the paid up capital and deposits of the credit society, or in excess of such lesser percentage as may be provided in the By-laws. (c) That the total assets of the borrower as shown by a statement of his affairs before the loan is made do not exceed such amount as may be fixed by the society in its By-laws. (2) If the By-laws.so provide loans may be for the purchase of land or the purchase'or erection of buildings used in the operation of a society or for financing the operation of business.of a cooperative society subject to the following conditions: (a) That the combined amount of paid-up capital and deposits of credit society is not less than shillings 250,0001-. (b) That a loan made for the purpose of this sub-rule and the total of any other loan made to the borrower as society shall not at any time exceed an amount in excess of eight percentum of the paid-up capital and deposits of the credit society, or in excess of such lesser percentage as may be provided in the By-laws, financial year, do not exceed such amount as the By-laws of the financial statement filed with the Registrar for the proceeding financial year, do not exceed such amount as the By-laws of the society shall prescribe. (3) Loans made for financing the operation of business in accordance with sub-rule (1) and (2) shall be made only for the following purposes: (a) for improvements to buildings or equipment used in the business, (b) for the purchase of agricultural or other commodities for marketing, of for the purchase or agricultural requisities or other merchandise for sale at retail, (c) for the consolidation of debts incurred by the borrower in the operation of the business. 903 G.N. No. 4IJ8 (contd.) Suspen- 103. Where the Registrar is of opinion that the manner in which loans­ sion and are being made by a savings .and credit society as disclosed by an JeSump- examination or investigation under the Act, or the amount of loans tion of loaning being made threaten the financial stability of the savings and credit opera- society and the interests of its members, he may: tions (a) by written notice sent or delivered to the Chairman and treasurer or Secretary treasurer or manager, as the case may be, order the suspension of loaning operations during such period as he may prescribe, (b) the Registrar to calla special general meeting to advice the members on the issue as per section 66 of the Act. The meeting shall appoint a person to act as a care taker of the financial affairs of the society, (a) Permit the resumption of loaning operations after the financial position of-the savings and credit society has been restored to a satisfactory basis under the direction of its own officers or subject to assistance from such special committee or other special officers as he may appoint. (b) The general meeting may suspend and resume loaning operations. Uncollec­ tibleloans and charge offs 104.-(1) Where the whole or any part of a loan has remained unpaid for a period of four years from the date fixed for repayment of the loan in full, and on payment on account of the principal has been made to the savings and credit society after the date, the amount remaining unpaid shall be charged to and paid from the reserve account. , (2) No loan shall be charged to the reserve fund without the approval of the general meeting. (3) The amount to be charged off under sub-rule (1) shall be deter­ mined after deducting the shares and deposits, if any, standing to the credit of the member in default, on the books of the savings and credit society, and less the market value of any security held by the savings and credit society as security for the loan. (4) The committee may, in its discretion determine that loan to be charged to and paid from the reserve fund under sub-rule (3) be paid from the reserve fund in annual instalments over a period of fiveyears. (5) Where no payment of interest and principal has been made to a savings and credit society on a loan made by it within a period of two years after the date on which the interest on principal become due, no further interest on loan shall be credited to the revenue of the savings and credit society as an account receivable. (6) Any money subsequently received with respect to a loan charged off under this rule shall be paid into the reserve fund. 904 Co-operative Societies Rules G.N. No. 408 tcontd.] I 105. Where the total of the amounts to be charged off to the reserve fund under rule 104 exceeds the amounts of money in such reserve fund, no further payments to members shall be made except to the reserve fund until the moneys in the fund are sufficient to pay all amounts to be charged thereto. 106.-(1) Monthly and yearly reports of every savings and credit soc­ iety shall include a list of all overdue loans for or loans in arrears showing with respect to each loan: (a) The total amount of the principal outstanding, (b) The terms of repayment and interest agreed upon with the bor rower. (c) The amount and number of instalments in arrears. (d) The date on which the last payment was in arrears. (e) The amount of shares and deposits assigned to the savings and credit society by the members in arrears, (f) A description of the security held. if any, (g) The estimated value of the security for the loan in arrears. (h) The net amount of the loan in errears after deducting the amount of shares and deposits assigned and the loan in arrears. (2) The list of referred to under sub-rule (1) shall be prepared within thirty days after the end of the savings and credit society to which the list relates. shall be signed as correct by the treasurer or the secretary-tre­ asurer or the manager as the case may be, and shall be approved by the Chairman. and a copy sent to the Registrar immediately. (3) For the purposes of this rule 'loan in arrears' means any loan which the member is in default for more than thirty days on a payment or repayments of principal or interest according to any loan agreement he has made with the credit society. limita tion of payments List of loans in arrears 107.-(1) All payments to or withdrawals from share capital amount Use of or from deposit amount. of any. shall be shown by the necessary entries pass book in the pass-book or statement provided to the member. (2) The proceeds of any loan and repayment therein. together with interest payments. shall he shown by the necessary entries in the pass­ book or statement provided to the memher as in sub-rule (I). (3) All entries in a pass-book statement under this rule shall he in­ itiated by the treasurer or his authorized assistant except where machine posting is used. (4) A memher using the stop order deduction plan for payments to or withdrawal from a savings and credit society pursuant III the Act. shall present his pass-book to the treasurer or his authorized assistant at least quarterly. l)( I:' Inspec­ tion Evalua­ tion in a savings and credit Society Co-operative Societies Rules d.N. No. 408 (contd.) (5) If a pass book is lost or destroyed, immediate notice of the loss or destruction shall be given by' the member to the treasurer who may issue a new pass-book. Provided that where a new pass-boo" is so issued the member's account in the savings and credit society may be given a new number. 108.-(1) An annual inspection and audit of the affairs of a savings and credit society as required b'y the Act shall include an examination and evaluation of membership, management structure, shares and de­ posits, interest charges, reconciliations of cash, bank, shares, loans and deposits, loans withdraws, repayments. (2) An annual inspection and audit of the affairs of a savings and credit society shall include an examination and evalution of each loan as shown by the books to determine the prospects for repayments whether the security appears to be adequate and in order, and what further action, if any will be necessary to ensure action, if any will be necessary to ensure ultimate repayments. (3) The inspection and audit report shall include a classification of each loan as follows: (a) Repayment in accordance with the terms of the loan seems ~s­ sured. (b) Repayment will be delayed and new terms may have to be ar­ ranged. (c) Doubt-ful unless additional security is provided by the borrowers. (d) Poor in that a loss is probable unless adequate and immediate remedial action can be taken. Discus­ sion of in­ spection report with officers of a society Distribu­ tion of net surplus of credit soc­ iety (4) The audited report of a savings and cradit society shall disclose among other things the conditions of those loan that require special action to ensure repayment. 109.-(1) Immediately after his inspection and audit of a savings and credit society the representative of the Registrar or other duly authorized person who conducted such inspection and audit, shall meet with the managing committee to discuss with them the conditions of the society as he found it and the need any immediate action to be taken by the managing committee and other officers to improve loaning and other operations and to protect the interest of the members. (2) A report of any discussion under sub-rule (1) shall be included in the inspection and audit report to be sent to the Registrar for such further action as he may seem necessary. 110.-(1) When determining the net surplus made by a savings and credit society, the managing committee shall deduct and set aside annu­ ally in reserve fund against uncollectable loans and probable future losses such sums as shall be equal to at twenty percentum of the years surplus, until the reserve fund is equal to and remain equal to at least 906 Co-operative Societies Rules C.N. No. 408 (conul.] ten percentum of the outstanding loans repayable oil saving and credit society or to such other greater amount as may be prescribed in these rules or by-laws. (2) Share Transfer fund ten percentum but the amount should not exceed ten percentum of total share capital. (3) After determining the reserve fund and share transfer fund the managing committee of the savings and credit society shall present to the annual general meeting a declaration respecting the distribution of the net surplus which may provide: (a) That a dividend of it specified amount not exceeding six percenturn per annum be paid to the members on all fully paid up shares as shown by the books of the savings and credit society at the end of the preceding financial year as rnay be prescribed in the by-laws. (b) That there he set aside, if the by-laws so provide a specified amount not exceeding five pcrcentum of the net surplus. to be used for such educational purposes as the managing committee may determine. (c) That the remainder of the surplus. if any, he divided amongst 'the members as a borrowers dividend in proportion to the amount of interest paid by them to the saving and credit society on all loans or on specified classes of loans during the preceding financial year. PART IX AMAL.(iA\lATIO' A'D DIVISIO' OJ SmlFIY 111.-( I) Where two or more existing societies resolve at their respec­ tive general meetings to amalgamate for their mutual advantage then they shall entrust their committee to arrange for a joint meeting of their committee to elect from amongst the members of their committee and on the basis of equal representation for each society, an amalgamation committee. (2) It shall he the duty of the amalgamation committee in consulata­ tion with the Cooperative officer. to prepare detailed amalgamation proposals which includc i-e (a) A viability statement. in such form as the Registrar may approve. (b) By-laws in respect of the proposed amalgamated society, (c) The date from which it is proposed to make amalgamation cftcc­ rive (3J The ,,'nalgamation proposals shall be presented to a joint meeting of the committe-e \,1' the societies concerned for consideration and accep­ tance. (~) Where amalgamation proposals arc accepted hy the joint meeting of the committee an application ...hall be made to the rcgi ... trur tor his approval to proceed in the manner prcscnbcd in SL'L't ion lJ7 of t I)L' Act. 907 Procedure on vulun­ tan' arnal­ gamatil111 Co-operative Societies Rules C.N. No. 408 (contd.} Election 112. Where an amalgamated society is registered, the society snail of new proceed to hold a general meeting and elect a committee. commit tee Procedure on volun­ tary divi­ sion Election of com­ mittee of divided societies Rules re­ lating to winding up of societies 113. Where an existing society resolves to divide into two or more separate societies the committee shall prepare, in consultation with the cooperative officer, such detailed proposals as may be necessary and shall make application to the registrar for approval to proceed in the manner prescribed in section 99 of the Act. 114. After the registration of new societies emerging from the division of an old society each such new society shall proceed to hold a general meeting and elect a committee, as soon as practicable but such period shall not exceed one calender month. PART X DISSOLUTION OF SOCIETIES 115.-(1) Upon the cancellation of the registration of a society taking effect the Registrar may publish in such manner as he thinks proper I a notice requiring claims against the society to be submitted within one month to him or to such person as he may name as liquidator. All liabilities recorded in the ~ooks of any society shall be deemed ipso-facto to have been duly notified. (2) When an order cancelling the registration of a society is made by . the Registrar under section 100 of the Act, the liquidator may im­ mediately, and shall from the date on which the order takes effect, take charges of the books of the society in order to wind up its affairs. (3) The liquidator shall proceed to determine the assets and liabilities of the society as they stood at the time of cancellation of its registration and shall determine the contributions to be made by the members lind past members respectively to the assets of the society. He shall also determine by what person and in what proportions the cost of liquidation shall be borne. (4) The liquidator shall make an order noting the names of members and past members of the amount to be realized from 'each as the conttibu­ tion under paragraph (c) sub-section (1) of section 105 of the Act, and as costs of liquidation under paragraph (e) of the same sub-section. This order shall be submitted to the Registrar for his approval, and he may modify it or refer it back to the liquidation for further Iquiry or other action. (5) A copy of the order as finally approved by the Registrar, accom­ panied if possible by a list of the property of each member or past member against whom the decree has to be enforced shall be filed in the court of resident magistrate having jurisdiction to be enforced as prescribed in paragraph (a) of sub-section 105 of the Act. ~ Co-operative Societies Rules G..V. No . .Jot) tcontd.) (6) If the court is unable to recover the sum assessed against member or members the liquidator may frame a subsidiary order or orders against any other member or members to the extent of the liability of each for the debts of the society until the whole amount due from the members is recovered and those orders shall be executed in the same manner. (7) The liquidator shall submit to the Registrar a report after such period and in such form as the Registrar shall require. showing the progress made in the liquidation of the society. (8) All funds in the charge of the liquidator shall be deposited with such bank or person as the Registrar may approve. (9) After recovery of the dues of the society and the realization of the contribution and costs of liquidation from the members and past members shall, after meeting the liabilities of the society. wind up its affairs and submit a final report to the Registrar. (10) The Registrar shall fix the remuneration if any. to be paid to the liquidator. (11) The Registrar shall fix a period within which the Liquidator shall complete Liquidation. 116.-(1) Where any person is aggrieved by a decision made by the liquidator of a society he shall within thirty days of the date of the decision appeal to the court of resident magistrate or further appeal to the High court. (2) On an appeal under paragraph (1) the court may confirm. set aside or vary the decision of the liquidator. (3) An order of the court on appeal under this rules may be so ap­ pealed from in the same manner and to the same extent in all aspects as a decree of that court in a civil suit. Appeals from deci­ sion of liquidator PART XI MISCELLA:--JEOUS RULES (i) Use and Maintenance of Reserve Fund: 117. Subject to rule 48 of the reserve fund or funds as prescribed by Us~ of rc­ the Act and the by-laws of a society shall be used to protect the financial serve fund position of the society under the following conditions: (a) The net losses resulting from the business operations of a society in any year as well as uncollectible loans or other overdue costs or instalments. (b) In the event that the reserve fund of a society is deplccted or reduced as a result of operational losses or uncollectible loans or other accounts being charged against it. the amounts to be placed in the reserved fund each year from the surplus arising from the business of the society as provided in the by-laws shall be increased by an additional ten percentum. if the Registrar so 909 Co-operative Societies Rules C.N. No. 408 (contd.} Invest­ ment uf moneys in the re­ serve fund Discus­ sion of in­ spection report with officers of a society Special service by another society Special services by Gov­ ernment agencies directs. or the Registrar may direct that the entire surplus arising from the business of the society in each year shall be placed in the reserve fund until the amount in that fund has reached the amount that stood prior to the losses charged against it. (c) No member shall have any claim against the fund or funds of society prescribed by the Act and provided for in the by-laws except in the case of closure ef liquidation in accordance with the Act. I H~. Subject to the approval of tile Registrar. money placed in a reserve fund may until required for tBi purposes of a society, be depo­ sited in any commercial bank or fin••l institution in Tanzania. (ii) Inspection and management"'d"*t 119.-(1) Immediately after his in~on and audit of co-operative society the representative of the R....r or other duly authorized person who conducted such inspectittil .. ,udit shall meet with the managing committee !o discuss wif1I1td.::JNldition of the society as he found it and the need for an)' lnfO ......0 be takin. the managing committee and other ~~tI~ operatioQs to protect the interests of members of thtl bleb rdf tlttiitical or special advice to improve operation. and te acft)e-tt 1ht objljotl . e society. (2) Discussion under sub-rule (1) include the condition of accounts payable by the society. including debts owing to the society by its mem­ bers and the need for immediate action it required in connection with such accounts. (3) A report of any discussion under sub-rule (1) shall be included in the inspecting and audit report to be sent to the Registrar for further action as he may deem necessary. 120. The Registrar shall arrange with officers of the society to which another society is affiliated to provide, where consistent with its objects such technical or other information and advice regarding the operations of a society which is a member to such society, as may be necessary to assist its officers and members in the achievement of its objects and purposes, and to provide to the society other services, designed to facili­ tate the annual inspection and examination of its affairs, such a society shall provide the Registrar with such yearly other returns and information as he may require for the purposes of the Act. 121.-(1) When the Registrar. subject to instruction. if any from the Minister responsible for Cooperative societies arranged with the proper officers of any department or agency of the Government such that depart­ ment or agency undertake to provide such technical or other information and advice ragarding the operations of a society as may he necessary to assist its officers and members in the achievement of its objects and purposes and where appropriate to provide to the society other services 910 Co-operative Societies Rules G. N. No 408 tcontd.t designed to facilitate annual inspection and examination of its affairs. such a society shall provide the Registrar with such yearly and other returns and information as he may require for the purposes of the Act. (2) The adequancy of any inspection or examination or other service provided to a society under sub-rule (I) shall be subject to the approval of the Registrar of Cooperative societies. 122.-( I) When the Registrar is of the opuuon that one or more persons because of their knowledge, experience and position. will he able to advice and assist the officers of a society in the achievement of its objects and purposes, may appoint such a person or persons as advis­ ory member of members of the managing committee of the society for such a period as it may specity: Provided that such advisory member of managing committee shall have all the rights and priviledges of an elected committee member except the right to vote. (2) When the br:1aws of a society provide for the admission of an advisory or ex-offtao members to assist and advise the society in the achievement of its ~j~cts and proposes, such advisory or ex-officio members shall subject to the by-laws havel all the right and priviledges of members except the right to vote. 123. Any member of the public shall be permitted on payment of the prescribed fees, to inspect at tbe office of the registrar any of the following documents: (a) The registration U.s"r, (b) The registration ~~ate of society. (b) The registered By",-~ of a society and the amendrnen ts affected in such By-laws, (d) An order cancellidl:o.J: registration of a society. (e) An order directing liquidation of a registered society. (f) The annual accountsl4l.ociety lodged by the society in accordance with the rules. 124. The fees specified in the schedule hereto shall he payable fur the matters to which they relate. 125.-( 1) The Cooperative Societies Rules, 1982 are hereby revoked. (2) Notwithstanding the revocation of the Cooperative Societies Rules, 1982 no act done under those rules shall be invalid onlv h\' the reason that those rules have been revoked and the same act shall continue as if commenced under these Rules. 911 Special service by advisory officers and memo herv Ir\spCL uou o l dOLlI­ mL·n: -, Rcvo.:;» tioll Co-operative Societies Rules C.N. No. 408 (contd.) SCHEDULE (Rule 124) 1. On application for registration of primary society .. 2. On application for Registration of a Secondary Society . 3. On application for Registration of an apex Society . 4. On application for registration of a federation . 5. On application for registration of a joint enterprise .. 6. On issue of Certificate of registration of a primary society .. 7. On issue of Certificate of registration of secondary society . 8. On issue of certificate of registration of an apex society . 9. On issue of Certificate of registration of a federation .. 10. On issue of certificate of registration of joint venture .. 11. On registration of by-laws: (a) A Primary Society . (b) A joint Enterprise . (c) A Secondary Society .. (d) An apex Society . (e) A federation .. 12. For registration of every amendment of by-laws of a primary society 13. For Registration of every amendment of by-laws of a secondary society . 14. For Registration of every amendment of by-laws of an apex society. 15. For Registration of every amendment of by-laws of a federation .. 16. For Registration of every amendment of joint venture . 17. For every inspection of the Register .. .. 18. For every inspection of the public file of any Society . 19. For every registration of a charge by society . 20. For every inspection of register of charges .. 21. Fesa.copy of a certified document or an extract there from per single page or part of a single page . 22. For Certifying any document or part there-from .. 400.00 700.00 1,200.00 2.500.00 600.00 200.QO 400.-"'l 600~ 1.000.0() 300.00 1.20000 I.XOO.OO 2.500.00 3.500.00 ...000.00 400.00 X50.00 1,400.00 2.000.00 600.00 120.00 60.00 300.00 60.00 120.00 200.00 SCHEDULE Coop. Form No. 1 Cooperative Societies 1991 APPLICATION FOR REGISTRATION TO: THE REGISTRATION OF COOPERATIVE SOCIETIES LIMITED We the undersigned, apply that the above society be registered as a Cooperative Society under the Cooperative Societies Act 1991.. 2. (2) Four copies of the application and four copies of the by-laws are enclosed together with the following fees. as required by Rule 124 of the Rules: Shs. Cts. (i) On application .. (ii) On issue of Certificate of registration .. (iii) On registration by-laws .. 3. OTher required details are shown on the back of the form: • (a) Name and surname Age Residence Local District Authority • (b) Name of society and Reg. No. 912 Signature Co-operative Societies Rules G.N. No. 408 (contd.] • (c) Name of Union Reg. No. Area of Operation of the Union Region District. Name of Authorized Person Signature • (d) Name of an Apex Area of operation of Apex society NOTES Narne of Signature Authorized person (a) Primary society (section 24 (1) of the Act) In the case of a society which after regist­ ration will be a primary society, the application shall be signed by at least the minimum number of persons who have attained the apparent age of eighteen. (b) Seconsary society (Section 24 (2) of the Act) by at l~ast two registered Primary societies. In the case of a society of which a member is a registered society ehe application shall be signed by a duly authorized person on behalt of ,every such registered society. (c) An Apex Society (Section 24 (2) of the Act) In the case of a society of which a member is a secondary society. the application shall be signed by duly authorized persons on behalf of at least two registered secondary societies. (d) Federation society (Section 24 (2) of the Act). In the case of a society of which a l'lember is a secondary society, the application shall be signed by duly authorized persons on behalf of at least two registered apex societies. (e) Co-operative Joint Enterprise. The application shall be signed by duly authorised person on behalf on at least twoi registered societies which form the membership of such Joint Enterprise. REGISTRATION DETAILS (a) Primary Society I. Name of the proposed society. 2. Address of the society. 3. Objects of .he society. 4. Area of operations. 5. Nationality of members. 6. Occupation of members 7. Qualifications proposed for membership of the society. ~. Whetller liability to be limited or unlimited. ~. J\mounr of entry f~e. 10. Value of shares/contribution. 11. Amount of [evy or cess or other incomes. 12. Maximum liability requested which may be incurred in loans or deposits Amount from non-member Rule. ego advances from a Bank. 13. Name of branch of Bank proposed. 14. Financial year of society. 913 Co-operative Societies Rules G.N. No. 408 (contd.} REGISTRATION DETAILS (b) Ioint EnterpriselllniontApex Societyl Federation 1. Name of proposed joint EnterprisefUnioniApex Society/Federation . 2. Address of the joint Enterprise/Union/Apex Society/Federation . 3. Objects of the joint EnteprisesfUnioniApex SocietylFederation . 4. Area of Operation . . 5. Name of societies forming the joint EnterpriselUnioniApex SocietylFedera tion . 6. Activities of member societies . 7. Qualification proposed for membership of the joint Enterprises/Union/Apex Soci etylFederation . 8. Whether liability to be limited or unlimited . 9. Amount of entry fees , . 10. Value of share . 11. Amount of expected income .. 12. Maximum liability requested which may be incurred in loans or deposits from non members rule . 13. Name of branch of Bank proposed . 14. Financial year of the joint Enterprise/Union/Apex Society/Federation . THE UNITED REPUBLIC OF TANZANIA Coop. Form No.2 CERTIFICATE OF REGISTRATION No . I hereby certify that . ................ societyfUoioo/Apex SocietylFederation Limited is this day registered under the pr~jons of secuon 30 of the Co-operative Society Act 1991. This certiticate is issued subject to the following specific conditions . 914 Co-operative Societies Rules G.N. No. 4()8 (consd.) Given under my hands this ...... ....... .......... ....... ........ ........ ..... ... ........ ........ .. day of 19 . Registrar of Co-opertuive Societies CERTIFICATE OF REGISTRATION Coop. Form No: 3 No . I hereby certify that . Co-operative Joint Enterprises, Limited is this day registered under provisions of setion 19 of the Co-operative societies Act 1991. This certificate is issued subject to the following specific conditions Given under my hands this day of .. ............................................................................................... 19 . Registrar of Co-operative Societies THE UNITED REPUBLIC OF TANZANlA Co-op. r-orm No.4 CO-OPERATIVE SOCIETIES ACT. 1991 PARTICULARS OF A MORTAGAGEICHARGE CREATED BY A CO-OPERATIVE SOCIETY SCHEDULE TO SECTION 86 (1) Name Co-operative Society/Joint EnterpriKsI Union Apex Society/Federation Limited. Registration Number . Date of resolution authorizing creation of charge/issue of debenture . ..................................................................................................................... General description of property charged .. Date and description of Instrument Creating or evidencing mortgage/charge .. ..................................................................................................................... Amount secured by mortgage/charge ................................................................. 91:; Co-operative Societies Rules G.N. No. 408 (contd.] Name. addresses and description of persons entitled to the mortgage/charge Name of trustees (if any) for debenture uoldcrs Delivered on behalf of .. Date . Fees paid shillings E.R.V. No .. ....... 19 . ......... Date To: THE REGISTRAR OF CO-OPERATIVE SOCIETIES. P.O.Bm . THE UNITED REPUBLIC OF TANZANIA CO-OPERATIVE SOCIETJES ACT. 1991 No .. NAME . CO-OPERATIVE SOCIETY/JOINT ENTERPRISE/UNION/APEX SOCIETY FEDERATION LIMITED Name . Surcharge I: Issued Date . THE UNITED R~PtmLlt:OF TANZAN{A CO-OPERATIVl: ~(\CIETIES ACT. 199J CO-Ill'. hum No . ~; No. CERTIFi(-'ATE OF SURC\-f;\~~GF. Where by notice jss\led by .. ....... t hc Rcgistrar/Dcputv Registrar/A~~istant Registrar of Co-operative S'';:ll·t:es Amount .. Appeal .. of . was surcharged the sum of Shs. AND WHEREAS did Surcharge II: Dtrte .. 916 not appeal against the said surcharge to the Minister responsible for File Co-operative Societies Rules C.N. No. 408 tcontd.] Co-operatives/The High Court, and its was decided on the said appeal that .... I hereby certify that the sum of Shs .., . is due from the said .. by way of surcharge issued under my hand and sealed this .. day of 19 . REGISTRAR OF CO-OPERATIVE SOCIETIES MINiSTRy .. Station . Date . THE UNITED REPUBLIC OF TANZANIA Co-op. Form No.6 CO-OPERATIVE SOCIETIES ACT, 1991 CERTIFICATE OF REGISTRATION OF CHARGE SCHEDULE TO SECTION 86 (2) I hereby certify that a charge/Mortgage dated the . day of 19 and .... .. .. .. .. .. . .... .. .. .. .. ... .. .. ........ .. .. .. ... ... created by . Co-operative Society/Joint EnterpriselUnion/Apex Society/Federation Limited Registered No in favour of.. .. to secure the sum of shillings (Shillings ) has this day been registered in accordance with the provisions of the Co-operative Societies Act, 1991and has been entered in the chronological index of the register under number. GIVEN UNDER MY HAND at Dodoma this day of .. .............................................................................................. 19 . REGISTRAR OF CO-OPERATIVE ~vCIETIES Co-op. Form No.7 Economic Liability-General information. CO-OPERATIVE SOCIETIES ACT No 19 .. SECTION SUB-SECTION RULE 917 Co-operative Societies Rules G.N. No. '408 (cortd.} VIABILITY ASSESMENT GUIDE FOR A CO-OPERATIVE SOCIETY PART I 1.0 Introduction: 1.1 Proposed Name . Region District . 1.2 Area of operation . 1.3 Initial Members . 1.4 Potential Members . 1.5 The nearest society is km. away PART II 2.0 Membership Quality Factors: 2.1 The common needs criterion 2.2 The common Bond criterior PARTm 3.0 Economic Data: 3.1 Basic Initial Requirements for activity e.g, Buildings 3.2 Sources of Funds for activity Entrance Fee Share contributions Borrowed capital Others 3.3 Economic stability of Area where society willoperate (Trend of the economy in this area for the past several years and for several years to come). 3.4 Supply and Demand Analysis for product (To show-purchasing power and the needs for the product Production capacity Availability of Raw Materials 3.5 Asessment of Income and Expenditure (To show) Annual~e from operations Annual Expenditure Surplus/deficit Projections for the same 3.6 Audited Balance ShcetslStatement of Affairs for the Amalagamatinl6 societies. 918 Co-operatives S«ieIies Rules G.N. No. «J8 (coIIId.) PART IV 4.0 S"pportiw Symnu: 4.1 Good and Reliable Sen1<:es :-Exteusioa experts +~ankiDg ~rolice Insurance POlIta1 Services TraDSpOrt facilitia-l>iatance to UnioII/Faetory Storqe facilities ProceIIiDI facilitiea Availability of Manpower amoDl the potential memben 4.2 Government support (i.e reeopition from the GovemmentIParty) 4.3 Support from other inatitutiollllOrpnizations PART V 5.0 LimiuJdoru: 5.1 GeoIf8Pbi<:al environment 5.2 Silliness competition PART VI 6.0 Social Coruiderlllions: 6.1 Social impact tomemben 6.2 Social impact to non-members 6.3 Social costa 6.4, Ability ofsociety to educateits members PARTVll 7.0 RecomntDUlations: 7.1 To give a general opinion regarding: Businell efficiency and effectiveness Management system and accountability 7.2 To give advise to the Registrar regardina: V18bility and suitability of co-operative activities and the society in general for regiStration. I APPROVE Dar es Salaam, 4th September, 1991 A. M. ABDALLAH, Minister for Agriculture, Livestock Developmentand Co-operatives 919