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Public Consultation On The Draft Co-Operative Societies (Amendment) Bill
Posted on Tuesday, April 15, 2008 - 06:00 PM

Following the recommendations of an inter-agency team on the review of the regulation of co-operatives (co-ops), the Registrar of Co-operative Societies (RCS) will be conducting a public consultation on the draft Co-operative Societies (Amendment) Bill. The draft Bill aims to help the co-op sector further raise its level of accountability and governance, as well as to set the framework for a more risk-focused co-op regulatory regime. The last major amendment to co-op legislation was in 1980.

2. The draft Bill, which took into account the comments and feedback of co-ops and key stakeholders on the recommendations of the inter-agency team, includes updates to co-op legislation in the following areas:

i) Election of board members: All co-op board members will need to be elected at a general meeting for better accountability and transparency.

ii) Duties and accountability of board members: Co-op directors will be required to act in good faith, use powers for proper purposes and declare their interests, similar to the duties required of company directors.

iii) Accounting standards: Co-ops will have to comply with accounting standards prescribed by the Accounting Standards Council, as required of companies and societies.

iv) Dealing with co-op non-compliance: The regulator will have a range of options to deal more effectively with co-op non-compliance which includes the composition of offences.

v) Credit-co-ops: Credit co-ops will be subject to more stringent registration criteria and higher levels of governance due to their higher regulatory risk.

3. The draft Bill will also remove some outdated prescriptive requirements to provide co-ops with more flexibility to manage their operations and compete in the marketplace. The changes include:

i) Investment: Co-ops will no longer need the Registrar’s approval for property investments.

ii) Statutory reserve fund: Co-ops will no longer be required by statute to set aside a portion of their surpluses as reserves.

iii) Conduct of general meetings: The quorum requirements for general meetings will be reduced to allow co-ops, particularly the smaller ones, additional flexibility when conducting such meetings.

4. The draft Bill can be viewed online at the REACH portal www.reach.gov.sg from 15 April 2008 for a month. The public and co-ops can send their inputs through the portal till 14 May 2008.

Issued by:
Ministry of Community Development, Youth and Sports
15 April 2008

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Annex A

Fact Sheet on Co-operatives

A co-operative society (‘co-op’) is an association of persons who have voluntarily joined together to achieve a common economic and social end through the formation of a jointly-owned and democratically controlled business organization. Co-ops can be considered business entities with social purposes.

Co-op members make equitable contributions to the capital required and accept a fair share of the risks and benefits of the undertaking. Co-operative societies work on the principles of self-help and mutual assistance to provide services for their members.

Co-ops are registered under the Co-operative Societies Act (CSA) which is administered by the Registry of Co-operative Societies at the Ministry of Community Development, Youth and Sports. The Registry works closely with the Singapore National Co-operative Federation, which is the co-op apex organisation, to raise the level of governance of the co-op movement.

There are currently 88 registered co-ops, of which the NTUC co-ops are among the more widely known. Co-ops provide a variety of services - including consumer, medical, insurance, dental, transport, security, food, housing, travel, childcare and welfare services.

The total number of individual members in the Singapore co-op movement is about 1.7 million. Co-ops are regulated through the Co-operative Societies Act which has been largely unchanged since the last major amendment in 1980.

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