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Co-operatives Act


Published: 1996

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OF THE

REPUBLIC OF NAMIBIA N$II.50 WINDHOEK - 20 December 1996 No. 1467

CONTENTS

Page

GOVERNMENT NOTICE

No. 327 Promulgation of Co-operatives Act, 1996 (Act 23 of 1996), of the Parliament. .

Government Notice

OFFICE OF THE PRIME MINISTER

No. 327 1996

PROM,ULGATION OF ACT OF PARLIAMENT

The following Act which has been passed by the Parliament and signed by the President in terms of the Namibian Constitution is hereby published in terms of Article 56 of that Constitution.

No. 23 of 1996: Co-operatives Act, 1996.

2 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

ACT

To provide for the formation, registration and winding-up of co-opera- tives and to provide for matters connected therewith.

(Signed by the President on 6December 1996)

ARRANGEMENT OF ACT

1. Definitions

Part I Administration of Act

2. Registration Officer for Co-operatives. 3. Appointment of Registrar of Co-operatives, Deputy Registrar of Co-ope-

ratives and acting Registrar of Co-operatives. 4. Seal of the Registrar and official stamp for Registration Office for Co-

operatives. 5. Register of co-operatives. 6. Inspection of register or documents and making copies thereof. 7. Annual report by Registrar.

Part II Categories and types of, and persons who may form, co-operatives

8. Categories and types of co-operatives. 9. Objects of, and co-operatives principles applicable to, co-operatives. 10. Persons who may form, and become members of, co-operatives.

Part III Provisions relating to by-laws of co-operatives

11. Contents of by-laws of co-operatives. 12. Amendment of by-laws.

Part IV Registration of co-operatives

13. Co-operatives' formation committees. 14. Co-operatives' founders meetings. 15. Applications for registration of co-operatives. 16. Registration of co-operatives. 17. Effect of registration of co-operatives. 18. Written contracts entered into on behalf of co-operatives before registra-

tion. 19. Registration of external co-operatives in Namibia.

No. 1467 Government Gazette 20 December 1996 3 Act No. 23, 1996 CO-OPERI\TIVES ACT, 1996

Part V Membership and liabilities of members of co-operatives

20. Registers of members of co-operatives. 21. Termination of membership of co-peratives and suspension of members. 22. Liability of members of co-operatives. 23. Imposition of fines upon members for contraventions of, or failure to

comply with, by-laws or internal rules of co-operatives. 24. Preference of co-operatives as creditors in respect of certain debts owing

by members. 25. Agreements entered into with co-operatives by members who are minors.

Part VI Administration of co-operatives

26. Postal addresses and registered offices, and-chief executive officers, of co-operatives.

27. Use and publication of names by co-operatives. 28. Copies of this Act, by-laws and internal rules of co-operatives and regis-

ters of members of co-operatives to be open to inspection.

Part VII Boards and supervisory committees

29. Boards of co-operatives. 30. Qualifications of members of boards. 31. Vacation of offices by members of boards, and filling of casual vacan-

cies. 32. Office bearers of boards. 33. Meetings of boards. 34. Minutes of meetings of boards. 35. Liability of members of boards. 36. Subcommittees of boards. 37. Supervisory committees of co-operatives. 38. Functions of supervisory committees. 39. Meetings of supervisory committees. 40. Notification to Registrar of certain information relating to members of

boards and supervisory committees.

Part VIII Meetings of members of co-operatives

41. Annual general meetings. 42. Ordinary and extraordinary general meetings. 43. Appointment of proxies. 44. Quorom for general meetings. 45. Chairperson of general meetings.

4 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

46. Minutes of general meetings. 47. Voting rights of members. 48. Meetings of members held on area or regional basis.

Part IX Financial matters of co-operatives

49. Funds of co-opratives. 50. Share capital of co-operatives. 51. Share certificates. 52. Payment of shares. 53. Bonus shares. 54. Cancellation of shares. 55. Transfer of shares. 56. Restriction on loans and investment of funds of co-operatives. 57. Provisions relating to grants, donations or other contributions made to

co-operati ves. 58. Co-operatives may maintain capital reserve funds or deferred expendi-

ture funds. 59. Distribution of net surplus. 60. Restriction of granting financial assistance. 61. Restriction relating to borrowing money.

Part X Accounting records, annual financial accounts and auditing

62. Financial year. 63. Keeping of accounting records. 64. Annual financial statements. 65. Rights of members to inspect annual financial statements. 66. Annual auditing of co-operatives. 67. Rights of auditor. 68. Powers and duties of auditor. 69. Submission of annual reports and auditors' reports. 70. Enquiries into affairs of co-operatives by or on authority of Registrar or

supervisory committees. 71. Powers of Registrar on account of reports or in consequence of enquiries. 72. Expenses incurred in connection with enquiries held under this Act.

Part XI Amalgamation, transfer, division and conversion of co-operatives.

73. Amalgamation of co-operatives. 74. Division of co-operatives. 75. Transfer of assets or liabilities of co-operatives to any other co-operative. 76. Conversion of co-operatives into any kind or form of juristic person or to

unincorporated association of persons.

No. 1467 Government Gazette 20 December 1996 5 Act No. 23,1996 CO-OPERATIVES ACT, 1996

Part XII Winding-up of co-operatives

77. Winding-up of co-operatives and appointment of liquidator. 78. Commencement of winding-up of co-operative. 79. Effect of winding-up on status of co-operative and legal proceedings. 80. Powers of liquidator. 81. Powers of Registrar to control liquidation. 82. Disposal of assets on liquidation. 83. Cancellation of registration.

Part XIII Co-operatives Advisory Board

84. Establishment of Co-operatives Advisory Board. 85. Functions of Advisory Board. 86. Members of Advisory Board. 87. Committees of Advisory Board. 88. Terms of office and conditions of service of members of Advisory Board. 89. Vacation of offices by members of Advisory Board. 90. Meetings of Advisory Board. 91. Performance of administrative functions of Advisory Board. 92. Expenses in connection with functions of Advisory Board.

Part XIV Co-operatives Tribunal

93. Establishment of Co-operatives Tribunal. 94. Functions of Tribunal. 95. Members of Tribunal. 96. Powers and duties of Tribunal. 97. Representation of parties to a dispute.

Part XV

Disputes between co-operatives or members of co-operatives and Regi- strar or such co-operatives or members and persons other than Regi-

strar

98. Appeals against decisions or orders of Registrar. 99. Reporting of disputes. 100. Disputes between co-operatives or members of co-operatives and per-

sons other than Registrar. 101. Disputes between co-operatives or members of co-operatives and Regi-

strar.

6 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Part XVI Offences and penalties

102. Prohibition of use of word "co-operative". 103. False statements. 104. Offences and penalties.

Part XVII Miscellaneous provisions

105. Closed co-operatives. 106. Determination of fees. 107. Regulations. 108. Delegation of powers. 109. Application of Act 23 of 1965 to co-operatives. 11O. Repeal of laws, and savings. 111. Interpretation of certain expressions. 112. Short title.

Schedule

BE IT ENACTED by the Parliament of the Republic of Namibia, as follows:-

Definitions

1. In this Act, unless the context indicates otherwise -

"Advisory Board" means the Co-operatives Advisory Board established by section 84;

"annual general meeting", in relating to a co-operative, means an annual gen- eral meeting referred to in section 41;

"board", in relations to a co-operative, means the board of the co-operative concerned referred to in section 29, by whatever name it may in terms of the by-laws of the co-operative be known;

"by-laws" means the by-laws of a co-operative, by whatever name it may be called by the co-operative concerned, referred to in section 11 and approved by the Registrar in terms of section 16(1)(c)(iii), and includes any amendment of such by-laws made by the co-operative and approved by the Registrar in terms of section 12;

No. 1467 Government Gazette 20 December 1996 7

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

"chief executive officer", in relation to a co-operative, means the person ap- pointed by a co-operatives as provided in section 26(2), by whatever designa- tion he or she may in terms of the by-laws of the co-operative concerned be called;

"co-operative" means -

(a) a workers' co-operative; or

(b) a service co-operative,

formed as provided in section 10 and registered, whether provisionally or fully, as a co-operative in terms of section 16, and includes, for purposes of the provisions of sections 12 and 17(1)( a) and (d) Parts V, VI, VII, VIII, IX, X, XI, XII, XV, XVI and XVII, an external co-operative;

"dispute" means a dispute in relation to -

(a) an alleged contravention of, or a failure to comply with, any provision of this Act or the by-laws or rules regulating the internal affairs of a co-operative;

(b) the suspension or expulsion of a member of a co-operative;

"external co-operative" means a co-operative of a level higher than the level of a primary co-operative and which has been registered outside Namibia;

"general meeting", in relation to a co-operative, means any ordinary or ex- traordinary meeting referred to in section 42, and includes an annual general meeting;

"liquidator", in relation to a co-operative being wound-up, means a person appointed under section 77 to carry out the winding-up of the co-operative;

"Minister" means the Minister of Agriculture, Water and Rural Development;

"Ministry" means the Ministry of Agriculture, Water and Rural Development;

"net surplus", in relation to a co-operative, means the surplus which results from the operations of the co-operative concerned during a financial year;

"official stamp of the Registration Office of Co-operatives" means the official stamp of the Registration Office for Co-operatives determined under section 4(b);

"Permanent Secretary" means the Permanent Secretary: Agriculture, Water and Rural Development;

8 Government Gazette 20 December 1996 No. 1467

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

"person" includes a natural person, a corporate body or an unincorporated as- sociation of persons;

"prescribe" means prescribed by regulation or under this Act;

"primary co-operative" means a co-operative formed as provided in section 10(3);

"register of co-operatives" means the register of co-operatives referred to in section 5;

"registered office", in relation to a co-operative, means the place where its head office is situated;

"Registration Office for Co-operatives" means the Registration Office for Co- operatives referred to in section 2;

"Registrar" means the Registrar of Co-operatives appointed under paragraph (a) of subsection (1) of section 3, and includes an acting Registrar of Co-ope- ratives appointed under paragraph (b) of that subsection and the Deputy Re- gistrar of Co-operatives appointed under paragraph (c) of that subsection, if any;

"repealed Ordinance" means the Co-operative Societies Ordinance, 1946 (Or- dinance 15 of 1946), repealed by section 110;

"seal of the Registrar" means the seal of the office of the Registrar referred to in section 4(a);

"secondary co-operative" means a co-operative formed as provided in section 1O(4)(a);

"service co-operative" means any co-operative referred to in paragraph (b) of subsection (1) of section 8 which enters into at least 51 per cent of its transac- tions with its members;

"special resolution", in relation to a co-operative, means a special resolution passed at a general meeting of the co-operative by a majority of votes of at least two-thirds of the members present at such meeting;

"supervisory committee", in relation to a co-operative, means the supervisory committee, if any, of the co-operative concerned referred to in section 37;

"this Act" includes the regulations made thereunder;

"Tribunal" means the Co-operatives Tribunal established by section 93;

"workers' co-operative" means a co-operative referred to in paragraph (a) of subsection (1) of section 8 of which -

No. 1467 Government Gazette 20 December 1996 9

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(a) all its members are working, in their capacity as members, in the co- operative; and

(b) at least 70 percent of the persons working on a full time basis in the co- operative, whether as employees or in their capacity as members, are persons who are members of that co-operative.

Part I Administration of Act

Registration Office for Co-operatives .

2. The office established by section 3(2) of the repealed Ordinance for the registration of co-operative societies and companies and for the other purposes of that Ordinance shall, notwithstanding the repeal of that Ordinance, continue to exist and shall be the Registration Office for Co-operatives for purposes of the registration of co-operatives in terms of, and for the other purposes of, this Act and shall be under the control of a person to be known as the Registrar of Co-operatives.

Appointment of Registrar of Co-operatives, Deputy Registrar of Co-ope- ratives and acting Registrar of Co-operatives

3. (1) Subject to the laws governing the Public Service, the Minis- ter -

(a) shall appoint a person as the Registrar of Co-operatives, who shall exercise and perform the powers, duties and functions conferred or imposed upon the Registrar by or under the provisions of this Act or any other law;

(b) may appoint a person as acting Registrar of Co-operatives to exer- cise or perform the powers, duties and functions of the Registrar referred to in paragraph (a) during the absence or incapacity of the Registrar to exercise or perform such powers, duties and functions;

(c) may appoint a person to be known as the Deputy Registrar or Co- operatives who may, subject to the control and directions of the Registrar, exercise or perform any of the powers, duties and func- tions of the Registrar referred to in paragraph (a).

(2) The Permanent Secretary may from time to time designate such other officers in the Ministry as may be necessary to assist the Registrar in the performance of the functions imposed upon the Registrar by or under this Act or any other law.

10 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Seal on Registrar and official stamp for Registration Office for Co-opera- tives

4. The Minister shall determine -

(a) a seal of office. for the Registrar of Co-operatives, which shall be impressed on certificates of registration of co-operatives and, in so far as it may be required in terms of any provision of this Act or otherwise deemed necessary by the Registrar, any other document issued by the Registrar in terms of this Act; and

(b) an official stamp for the Registration Office for Co-operatives, which shall be used as provided for in this Act.

Register of co-operatives

5. (1) The Registrar shall keep a register, to be known as the regis- ter of co-operatives, in which he or she shall enter the name and the prescribed paticulars of every co-operative registered in terms of this Act.

(2) The register of co-operatives or any extract or copy of that register signed by the Registrar shall be prima facie proof of all particulars recorded therein.

(3) The register of co-operative companies and societies kept by the Registrar of Co-operative Societies under section 3(3) of the repealed Ordi- nance shall be deemed to be part of the register referred to in subsection (1).

Inspection of register of co-operatives or other documents, and making of copies or extracts thereof

6. (1) Any person may on payment, effected by way of revenue stamps cancelled by the Registr ar, of the prescribed fees, if any -

(a) inspect the register of co-operatives or any document received or kept by the Registrar in terms of this Act;

(b) obtain a certificate from the Registrar as to the contents or part of the contents of the said register or any such document;

(c) obtain a copy of, or an extract from, the said register or any such document.

(2) If any inspection or any certificate, copy or extract referred to in subsection (1) is requested for the purposes of research by or under the control of an educational institution, the Registrar may permit such inspection, or issue or make available such certificate, copy or extract, without payment of any fees referred to in that subsection.

No. 1467 Government Gazette 20 December 1996 11 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Annual report by Registrar

7. (1) The Registrar shall submit to the Minister, not later than 31 March in every year or such later date as may from time to time be determined in writing by the Minister, a report on his or her activities in terms of this Act during the immmediately preceding year which ended on 31 December.

(2) The Minister shall lay a copy of the report referred to in subsection (1) upon the Tables of the National Assembly within 14 days after receipt of such report, if the National Assembly is then in session, or, if the National Assembly is not then in session, within 14 days after the commencement of its next ensuing session.

Part II Categories and types of, and persons who may form, co-operatives

Categories and types of co-operatives

8. (1) Two categories of co-operatives may be formed and regis- tered in terms of this Act, namely -

(a) workers' co-operatives; and

(b) service co-operatives, having the general characteristics or serving the purposes of anyone or a combination of the following types of co-operatives, namely -

(i) marketing and supply co-operatives;

(ii) consumer co-operatives;

(iii) housing co-operatives;

(iv) savings and credit co-operatives;

(v) such other types of co-operatives as may from time to time be determined by the Minister by notice in the Gazette.

(2) A co-operative referred to in subsection (1) shall be a primary co- operative or may, subject to the provisions of this Act, be a secondary co- operative or a co-operative of any level higher than secondary level.

Objects of, and co-operatives principles applicable to, co-operatives

9. A co-operative shall -

(a) have as its objects the promotion of the economic and social inter- est of its members by providing effective services to its members according to sound business principles; and

12 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(b) subject to the provisions of this Act, carry out its objects according to the co-operative principles that -

(i) membership of a co-operative shall be voluntary and, irre- spective of race, colour, ethnic origin, creed, religion, gen- der, political ideo-logy or social or economic status, open to any person who is able to contribute to, and benefit from, the activities of the co-operative, and who complies, subject to the co-operative's capacity and economic means to admit new members, with the requirements for membership as provided in this Act and the by-laws of the co-operative;

(ii) a co-operative shall be democratic and controlled by its mem- bers;

(iii) in the case of a primary co-operative, every member shall have one vote, irrespective of the number of shares held by him or her;

(iv) services shall be rendered primarily to members;

(v) dividends on share capital shall be limited;

(vi) any surplus of the co-operative shall be utilized for the development of the business or services of the co-operative or, with due regard to amounts set aside as a reserve as contemplated in section 58, for purposes of distributing any such surplus amongst the members of the co-operative or for both such purposes in proportion to the transactions entered into by such members with such co-operative and their resultant contribution to such surplus;

(vii) ongoing membership education be provided in relation to the administration and management of the co-operative and the nature and extent of the rights, duties, liabilities and obliga- tions of its members; and

(viii) in order to best serve the interests of its members and its com- munity, a co-operative should actively co-operate with other co-operati ves.

Persons who may form, and become members of, co-operatives

10. (1) Subject to subsections (2), (3) and (4) and section 9(b)(i), any person may participate in forming a co-operative or of becoming a mem- ber of a co-operative.

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Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(2) No natural person shall be qualified to form or to participate in the for-ming of a co-operati ve or of becoming a member of a co-operati ve, unless such pe~son -

(a) is at least 18 or, in the case of a co-operative of which all its mem- bers are learners at a school, 14 years of age; and

(b) in the case of a minor, is assisted by his or her parent or guardian;

(c) is a citizen of, or otherwise ordinarily resident in, Namibia;

(d) complies with such other requirements as may be prescribed by the by-laws of such co-operative.

(3) Subject to the provisions of this Act, at least seven -

(a) natural persons who are qualified in terms of subsection (2); or

(b) Namibian corporate bodies or unincorporated associations of per- sons, but excluding any secondary co-operative or a co-operative of any level higher than a secondary level; or

(c) persons consisting of any combination of persons referred to in para- graph (a) and (b),

may form a co-operati ve which for the purposes of this Act shall be a primary co-operative.

(4) For the purposes of this Act -

(a) two or more primary co-operatives may form a co-operative which shall be a secondary co-operative;

(b) two or more secondary co-operatives may form a co-operati ve which shall be of a level higher than a secondary co-operative;

(c) two or more co-operatives formed by a secondary co-operative as contemplated by paragraph (b) may form a co-operative which shall be of a level higher than that of such co-operatives;

(d) anyone co-operative of a level contemplated in subsection (3) and one other co-operative referred to in paragraph(a), (b) or (c) may form a co-operative which shall be of a level higher than the level contemplated in the said paragaph (c).

14 Government Gazette 20 December 1996 No. 1467

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Part III Provisions relating to by-laws of co-operatives

Contents of by-laws of co-operatives

11. (1) The by-laws of a co-operative shall be divided into paragraphs numbered consecutively and shall, in such order as the co-operative concerned may deem fit, set forth -

(a) its name, expressed as contemplated in section 27(1);

(b) its postal address and the street address of its registered office or, if no street address exists, a description of the place where such of- fice is situated;

(c) whether it is a workers' co-operative or service co-operative and, in the case of a service co-operative, its type or types, and whether it is a primary co-operative, a secondary co-operative or a co-opera- tive of any level contemplated in section 1O(4)(b), (c), or (d);

(d) its objects;

(e) the nature of the business and other activities carried on by it;

(f) the place where its main business is situated, the area in which it carries on business and the place where it has established or in- tends to establish any branch or depot;

(g) if it is formed for a limited period, the period for which it is so formed;

(h) subject to the provisions of sections 9(b )(i) and 10 and of Part V -

(i) the manner in which members shall be admitted, and the re- quirements and conditions of admission of members, includ- ing the fees, if any, payable on admission or in respect of membership and the circumstances under which membership is terminated;

(ii) whether the liability of its members is unlimited or limited;

(iii) the rights, duties, liabilities and obligations of members of the co-operative;

(i) subject to the provisions of Part VII -

(i) the manner of election, terms of office, suspension and re- moval from office of members of its board, and of its super- visory committee, if any, and the filling of casual vacancies

No. 1467 Government Gazette 20 December 1996 15 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

by way of election or appointment in such board and super- visory committee;

(ii) provisions relating to the holding of meetings of, or the pro- cedure at, meetings of its board and supervisory committee, if any;

(iii) the powers, duties and function of -

(aa) its board and, if provision is made for the establish- ment of subcommittees of such board,of such subcom- mittees, and of the members performing the functions ordinarily performed by a chairperson, secretary and treasurer;

(bb) the person, if any, to perform the functions ordinarily performed by a chief executive officer;

U) subject to the provisions of Part VIII -

(i) provisions relating to the holding of general meetings -

(aa) of its members;

(bb) of delegates appointed or otherwise elected by its mem- bers on a regional or area basis;

(cc) in the case of a secondary co-operative or a co-opera- tive of any level higher than secondary level, of dele- gates,

to consider any matter which may be or is required in terms of any provision of this Act or the by-laws to be considered at such meetings, and the procedure at such meetings;

(ii) for purpose of the election or appointment of delegates re- ferred to in subparagraph (i)(bb) or (cc), provisions relating to the holding of the necessary meetings, the manner of elec- tion or appointment, the qualifications, the terms of office and the voting rights of such delegates;

(k) subject to the provisions of Part IX -

(i) the amount of its share capital and the division thereof into shares of a fixed amount;

(ii) the manner in which its share capital may be increased or reduced;

16 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(iii) the minimum number of, and the manner of payment for, shares which each member shall be required to hold in it, and the repayment of amounts paid in respect of such shares upon termination of membership;

(iv) the purposes for which its funds may be utilized;

(v) the manner in which its net surplus shall be distributed by way of dividends or otherwise;

(vi) the condition on which loans may be obtained by or made to it;

(vii) the manner in which funds not required for immediate use may be invested;

(1) subject to the provisions of Part X, the keeping and auditing of accounts, books and records;

(m) the manner in which and the person by whom any of its officers or employees may be authorized to sign documents on its behalf;

(n) subject to subsection (2), the matters on which rules regulating its internal affairs may be made;

(0) any matter which is required by this Act to be prescribed in the by- laws of a co-operative,

and may contain any other matter not inconsistent with the provisions of this Act which is necessary or expedient in order to achieve its objects.

(2) Any rules regulating the internal affairs of a co-operative referred to in paragraph (n) of subsection (1) -

(a) shall not be inconsistent with any provision of this Act or the by- laws of the co-operative;

(b) shall be approved by special resolution by the co-operative.

Amendment of by-laws

12. (1) A co-operative may amend its by-laws by special resolution, but such amendment shall not be of any force or effect unless such amendment has, upon an application made to the Registrar in terms of subsection (2), been approved by the Registrar, and shall come into operation on the date on which it is so approved or on such other date (which may be a date prior to the date of approval) as may be specified in the special resolution.

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Act No. 23, 1996 CO· OPERATIVES ACT, 1996

(2) An application referred to in subsection (1) for the approval of the Registrar of an amendment of the by-laws of a co-operative shall be made to the Registrar, in such form as may be determined by the Registrar, within 30 days as from the date on which the special resolution referred to in that subsec- tion has been passed or such longer period as the Registrar may in a particular case, on good cause shown, allow.

(3) An application in terms of subsection (2) shall be accompanied by-

(a) a statement by the person who acted as chairperson of the general meeting at which the special resolution referred to in subsection (1) has been passed -

(i) that the said meeting was held on a date mentioned in the statement;

(ii) that he or she has satisfied himself or herself that proper no- tice of such meeting and the proposed amendment has been given to the members of the co-operative; and

(iii) that such special resolution was passed by a majority of votes of two-thirds of its members present at such meeting;

(b) an explanation of the reasons for the amendment;

(c) two copies of the special resolution in which the amendment is set out;

(d) revenue stamps to the value of such amount as may be determined in terms of section 106 in respect of applications made in terms of this section, and which shall be cancelled by the Registrar upon the granting of the application.

(4) If the Registrar is satisfied that the provisions ofthis Act and the by- laws of the co-operative concerned have been complied with in respect of an application in terms of subsection (2), he or she shall approve the amendment and make an endorsement on one copy of the special resolution in question to the effect that it has been approved by the Registrar and affix the official stamp of the Registration Office for Co-operatives on each page of the special reso- lution.

(5) The copy of the special resolution, endorsed as provided in subsec- tion (4), shall be handed over or forwarded by certified post within a period of two months from the date of such endorsement to the co-operative concerned, and the other copy of such special resolution shall be retained by the Registrar in the Registration Office for Co-operatives.

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(6) If the by-laws of a co-operative is amended in order to alter the name of the co-operative or an abbreviation of such name, the Registrar shall-

(a) enter the new name or abbreviation of such name in the register of co-operatives in the place of the name so altered; and

(b) issue within a period of two months from the date of such entry a certificate to such co-operative in which it is declared that the name of such co-operative or the abbreviation of such name has been altered in accordance with this Act and in which the new name or abbreviation of such name is mentioned.

(7) The Registrar shall, if an application in terms of subsection (2) is refused, within a period oftwo months from the date of such refusal, by notice in writing inform the co-operative concerned of such refusal setting forth his or her reasons for such refusal.

(8) An amendment or substitution which alters the name of a co-opera- tive shall not affect any right or obligation of the co-operative or its members or past members, and any legal proceedings pending may be commenced or continued by or against such co-operative under its new name.

(9) The provisions of this section, in so far as they relate to the ap- proval of the Registrar, shall not apply in relation to an amendment of the by- laws of a co-operative in terms of which -

(a) the minimum number of shares which every member of a co-ope- rative is required to hold in the co-operative is increased;

(b) the postal address or the street address of the registered office of the co-operative or the description of the place where such office is situated, is changed.

Part IV Registration of co-operatives

Co-operatives' formation committees

13. (1) Any person who is qualified in terms of section 10 to form a co-operative and who proposes to form and register a co-operative shall con- vene a meeting at which shall be present -

(a) in the case of a proposed formation of a primary co-operative, at least seven persons who are so qualified or, if anyone or more of such persons are primary co-operatives, corporate bodies, or unin- corporated associations of persons, one natural person in respect of each such co-operative, corporate body, or unincorporated associa- tion of persons, who is duly authorized in writing by such co-ope-

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Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(b) in the case of a proposed formation of a co-operative of a level higher than the level of a primary co-operative, at least two natural persons duly authorized by each co-operative that so proposes to form any such co-operative.

(2) The persons referred to in subsection (1) present at a meeting con- vened in terms of that subsection, shall elect from amongst their number a formation committee consisting of at least seven or, in the case of a proposed co-operative of any level higher than the level of a primary co-operative, four natural persons.

(3) The formation committee referred to in subsection (2) shall -

(a) elect from amongst their number at least three persons to perform the functions ordinarily performed by a chairperson, secretary and treasurer;

(b) cause minutes of its proceedings to be kept and maintained.

(4) The functions of a formation committee referred to in subsection (2) shall be -

(a) in the case of an intended application for provisional registration of a proposed co-operative-

(i) to convene meetings in order to advise prospective members on the proposed objects of the proposed co-operative and the nature of the business to be carried on by it and its other activities and the contents of its proposed by-laws;

(ii) to prepare, with due regard to the provisions of section 11, proposed by-laws for such proposed co-operative;

(iii) to take any such other steps as may be necessary for pur- poses of such intended application;

(b) in the case of an intended application for full registration of a pro- posed co-operative, in addition to the function referred to in para- graph (a)-

(i) to compile a list of its prospective members and an estimate of the share capital and subscriptions of such prosposed co- operative;

20 Government Gazette 20 December 1996 No. 1467

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(ii) to undertake a feasibility study on the nature, extent and eco- nomic potential of the proposed business of such proposed co-operative;

(iii) to compile an estimate of revenue and expenditure and a cash flow forecast for at least the first three years, or such shorter period as the Registrar may on good cause shown in any par- ticular case allow, of the business of such proposed co-ope- rative.

Co-operatives' founders meetings

14. (1) A formation committee referred to in section 13 shall, after having complied with the relevant provisions of that section, convene a founders meeting of persons qualified as provided in section 10 and who desire to be- come members of the proposed co-operative.

(2) At a meeting convened in terms of subsection (1) at which the re- quired number of persons prescribed by section 10 are present who are in favour of the formation of the proposed co-operative -

(a) there shall be submitted -

(i) in the case of an intended application for provisional registra- tion of the co-operative, the proposed by-laws referred to in section 13(4)(a)(ii); and

(ii) in the case of an intended application for full registration of the co-operative, in addition to the said proposed by-laws, the list, feasibility study, estimate of revenue and expendi- ture and cash flow forecast referred to in section 13(4)(b)(iii);

(b) a written declaration shall be prepared and signed by the persons present at such meeting in which it is declared that it has been re- solved to form such proposed co-operative;

(c) the proposed by-laws of such proposed co-operative shall be con- sidered and approved with or without amendments by a majority of votes of at least two-thirds of the persons referred to in subsection (1) present at such meeting;

(d) a register of members shall be opened and signed by the persons who are so present and who wish to become members of such pro- posed co-operative;

(e) there shall. subject to subsection (3), be elected by simple majority by secret ballot a number of natural persons mentioned in the pro- posed by-laws to be the members of the first board and the first supervisory committee, if any, of such proposed co-operative; and

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Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(f) there shall be kept minutes of the proceedings.

(3) No person shall participate in any election in terms of subsection (2)(e), unless he or she has signed the register of members of the proposed co- operative concerned.

Applications for registration of co-operatives

15. (1) Subject to the provisions of this Act, an application for pro- visional or full registration as a co-operative shall be made to the Registrar, in such form as may be determined by the Registrar, by not less than the required number of persons referred to in section 10 within a period of two months as from the date on which the founders meeting referred to in section 14(1) was held or such longer period as the Registrar may allow.

(2) Any application referred to in subsection (1) shall be accompanied by -

(a) in the case of an application for the provisional registration of a co- operative -

(i) the written declaration referred to in section 14(2)(b);

(ii) the by-laws of such co-operative approved as provided in section 14(2)(c) containing on each page thereof the initials, and on the last page thereof the signatures, of at least three persons elected in terms of section 14(2)(e) as the members of the first board of such co-operative;

(iii) a list of the persons who have in terms of section 14(2)(d) signed the register of members as first members of such co- operative;

(iv) a description of the proposed business and other activities of such co-operative;

(v) a list ofthe names and addresses, identity numbers and occu- pations of the persons elected in terms of section 14(2)(e) as the members of the first board and the first supervisory com- mittee, if any, of such co-operative; and

(vi) the minutes of the proceedings of the founders meeting re- ferred to in section 14(2)(f);

(b) in the case of an application for full registration of a co-operative, in addition to the documents referred to in paragraph (a), also the list, feasibility study, estimate of revenue and expenditure and cash flow forecast referred to in section 14(2)(a)(ii);

22 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(c) such other documents or information as the Registrar may require; and

(d) revenue stamps to the value of such amount as may be determined in terms of section 106 in respect of applications made in terms of this section, and which shaIl be canceIled by the Registrar upon the granting of the application.

(3) The Registrar may, for purposes ofthe consideration of an applica- tion made to him or her in terms of subsection (1), at any time visit any pre- mises of the proposed co-operative concerned or cause such meetings as the Registrar may deem necessary or expedient for purposes of discussing or de- termining any matter relating to such application to be convened at a place mutually agreed upon between the Registrar and the persons elected in terms of section 14(2)(e) as the first members of the board of that proposed co-ope- rative.

Registration of co-operatives

16. (1) Within a period of two months as from the date on which an application referred to in section 15 has been received in the Registration Of- fice for Co-operatives, or such longer period as the Permanent Secretary may upon good cause shown approve in writing, the Registrar shaIl consider such application and -

(a) shaIl grant or, subject to subsection (2), refuse such application;

(b) shaIl, if such application is refused under paragraph (a), by notice in wri-ting inform the persons concerned of such refusal setting forth his or her reasons for such refusal;

(c) shall, if such application is granted under paragraph (a) -

(i) provisionally or fully register, as the case may be, the co- operative concerned by entering in the register of co-opera- tives the particulars of such co-operative as required by sec- tion 5(1);

(ii) issue, in such form as may be determined by the Registrar, a certificate of registration that the co-operative concerned is provisionaIly or fully registered, as the case may be, and on which the seal of the Registrar is impressed and to which a number has been aIlotted;

(iii) approve, with or without any amendments, the by-laws of such co-operative and make an endorsement on each page of such by-laws to the effect that such by-laws have been ap- proved by him or her and affix the official stamp of the Regi- "trlltion nffirp for rO_on'>Tllti"pc An p",..h cll,..h no:>o-",'

No. 1467 Government Gazette 20 December 1996 23 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(d) may, if, in the case of an application for full registration as a co- operative, he or she is satisfied that he or she would have provi- sionally registered such co-operative had the application been an application for provisional registration, in consultation with the per- sons who made the application in question, provisionally register the co-operative mutatis mutandis in accordance with the provi- sions of paragraph (c).

(2) An application for provisional or full registration of a co-operative shall not be granted -

(a) if the Registrar is satisfied -

(i) that the provisions of this Act have not been complied with in relation to such application; or

(ii) that the by-laws of such co-operative are inconsistent with the provisions of this Act;

(b) unless and until such time as the Registrar is satisfied that the members of the first board of such co-operative elected in terms of section l4(2)(e) have sufficient knowledge of the by-laws of such co-operative and, in the case of an application for full registration, of the business and activities of the co-operative as reflected in the documents submitted in relation to the application, and the Registrar may from time to time postpone his or her decision on the application until he or she is so satisfied;

(c) unless, in the case of an application for full registration, the Registrar is satisfied that the co-operative is likely to be economically viable and that its registration will be in the interest of its members.

(3) (a) The certificate of registration issued in terms of subparagraph (ii) of paragraph (c) of subsection (1) and the by-laws endorsed as provided in subparagraph (iii) of that paragraph shall be handed over or forwarded by certified post to the co-operati ve registered in terms of subparagraph (i) of that paragraph, and a copy of such certificate and by-laws shall be retained by the Registrar in the Regi- stration Office for Co-operatives.

(b) A certificate of registration of a co-operative referred tojin sub- paragraph (ii) of paragraph (c) of subsection (1) or a certified copy thereof shall upon its mere production be prima facie proof that the requirements of this Act in respect of its registration have been com- plied with and that the co-operative is a registered co-operative.

24 Government Gazette 20 December 1996 No. 1467

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Effect of registration of co-operatives

17. (1) As from the date on which a co-operative is provisionally or fully registered in terms of section 16 -

(a) such co-operative shall become a corporate body;

(b) such co-operative shall be entitled to commence with its activities;

(c) every person who is qualified in terms of section 10 to become a member of a co-operative and who has, at the founders meeting referred to in section 14, signed the register of members shall be a member of the co-operative;

(d) the by-laws shall bind the co-operative and every member of the co- operative referred to in paragraph (c) and every member admitted as member on or after that date in terms of the by-laws of such co- operative (including an executor, a trustee or other administrator of the estate of a member) to the same extent as if it were signed by every such member, to observe, subject to the provisions of this Act, all the provisions of the by-laws;

(e) the persons elected in terms of section 14(2)(e) to be the first board and the first supervisory committee, if any, of the co-operative shall become the first board and first supervisory committee, as the case may be, of that co-operative.

(2) (a) Subject to paragraphs (b) and (c), the provisional registration of a co-operative in terms of section 16 shall lapse after the expiry of a period of one year as from the date of such registration.

(b) (i) The provisional registration of a co-operative may, upon an application made to the Registrar in such form as may be determined by the Registrar, at any time before the expiry of the period of one year referred to in paragraph (a), be re- newed by the Registrar on not more than four occassions for periods not exceeding one year at a time.

(ii) An application referred to in subparagraph (i) shall be ac- companied by such documents and information as the Regi- strar may require, and may be granted by the Registrar, if he or she is satisfied-

(aa) that the co-operative has during the currency of its pro- visional registration complied with the provisions of this Act and its by-laws;

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Act No. 23, 1996 CO-OPERATIVES ACT, 1996

not yet able to comply with the requirements for full registration;

(cc) that the co-operative has the ability to comply with such requirements within a reasonable period.

(iii) The Registrar may, for purposes of the consideration of an application contemplated in subparagraph (ii), at any time visit any premises of the co-operative concerned or cause such meetings as the Registrar may deem necessary or expe- dient for purposes of discussing or determining any matter relating to such application to be convened at a place mutu- ally agreed upon between the Registrar and the members of the board of the co-operative concerned.

(c) Where the provisional registration of a co-operative has lapsed or an application for the renewal of its provisional registration has been refused, such a co-operative shall for purposes of this Act be deemed to have been wound-up in terms of an order given under section 77.

(3) The Registrar may at any time during the currency of the provi- sional registration of a co-operative and upon application of such co-opera- tive, in such form as may be determined by the Registrar, withdraw its provi- sional registration and fully register such co-operative in accordance with the provisions of section 16(1) if he or she is satisfied that such co-operative com- plies with the requirements for full registration as a co-operative.

Written contracts entered into on behalf of co-operative before registra- tion

18. Any written contract entered into by any person purporting therein to have been so entered into on behalf of a co-operative before it has been registered under section 16 may, if such contract is within the objects and powers of such co-operative, be ratified and adopted by such co-operative after its registration, whereupon such contract shall be enforceable by or against such co-operative as if it were entered into by such co-operative.

Registration of external co-operatives in Namibia

19. (1) No external co-operative shall establish a place of business in Namibia, unless it has -

(a) as its member at least one co-operative registered under section 16(1)(c)(i); and

(b) been registered as provided in this section.

26 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

determined by the Registrar, to the Registrar for such registration: Provided that no external co-operative shall be registered in terms of this Act as a primary co-operative.

(b) An application referred to in paragraph (a) shall be accompanied by -

(i) a certified copy ofthe by-laws of such external co-operative, and, if such by-laws are not in the official language, a trans- lation thereof in English;

(ii) a notice of its proposed postal address and the street address of its proposed registered office in Namibia;

(iii) the name and address of its proposed auditor in Namibia;

(iv) a notice of its financial year;

(v) a list containing the full names and surnames, nationality, occupation, residential, business and postal addresses and the date of appointment or election of each member of its board and of its chief executive officer;

(vi) a list containing the names of its members;

(vii) a written statement showing its objects, its business prospects and particulars showing that, if registered, it will be able to carry out its objects;

(viii) the particulars of the co-operative referred to in subsection (l)(a);

(ix) revenue stamps to the value of such amount as may be deter- mined in terms of section 106 in respect of an application made in terms of this section, and which shall be cancelled by the Registrar upon the granting of the application.

(3) If the Registrar is satisfied that the provisions of subsection (2) have been complied with he or she shall submit the application, a copy of the by-laws and his or her recommendation to the Minister together with such other documents as may be required by the Minister.

(4) (a) Subject to paragraph (b), the Minister may, on the recom- mendation of the Advisory Board, approve or reject an application submitted to him or her in terms of subsection (3) or he or she may, before he or she approves or rejects it, direct the Registrar to refer the by-laws back to the external co-operative concerned for con- sideration of such modification thereof or additions thereto as may

No. 1467 Government Gazette 20 December 1996 27 Act No. 23, 1996 CO·OPERATIVES ACT, 1996

(b) The Minister shall not approve an application under paragraph (a), un-less he or she is satisfied that the registration of the external co- operative concerned is in the interest of co-operative development in Namibia.

(5) If the Minister approves an application made in terms of subsection (2)(a), the Registrar shall -

(a) (i) provisionally register the external co-operative concerned if in the Registrar's opinion the nature of the business and other activities of such co-operative are not clearly defined and some doubts exists as to the achievability of the business or activities concerned;

(ii) fully register the co-operative concerned if in the Registrar's opinion the nature of the business and other activities of such co-operative are clearly defined and achievable,

by entering in the register of co-operatives the particulars of such co-operative as required by section 5(1);

(b) issue, in such form as may be determined by the Registrar, a certifi- cate of registration that the co-operative concerned is provisionally or fully registered, as the case may be, and on which the seal of the Registrar is impressed and to which a number has been allotted; and

(c) approve the by-laws of such co-operative and make and endorse- ment on each page of such by-laws to the effect that such by-laws have been approved by him or her and affix the official stamp of the Registration Office for Co-operatives on each such page.

(6) (a) The certificate of registration issued in terms of paragraph (b) of subsection (5) and the by-laws endorsed as provided in para- graph (c) of that subsection shall be handed over or forwarded by certified post to the external co-operative registered in terms of paragraph (a) of that subsection, and a copy of such certificate and by-laws shall be retained by the Registrar Office for Co-operatives.

(b) A certificate of registration of a co-operative referred to in para- graph (b) of subsection (5) or a certified copy thereof shall upon its mere production be prima facie proof that the requirements of this Act in respect of its registration have been complied with and that the external co-operative is a registered external co-operative.

28 Government Gazette 20 December 1996 No. 1467 Act No. 23,1996 CO-OPERATIVES ACT, 1996

Part V Membership and liabilities of members of co-operatives

Registers of members of co-operatives

20. (1) A co-operative shall keep and maintain at its registered of- fice a register of members -

(a) in which shall, in so far as it may be applicable, be entered -

(i) the names, identity numbers and addresses of its members or, if anyone of such persons is a co-operative or a corporate body, its registration number;

(ii) the date on which each member became a member;

(iii) the number of shares held by each member;

(iv) the value of each share so held;

(v) the date on which the membership of any such member has terminated;

(vi) the date on which any shares held by a member have been transferred and the person to whom it has so been transferred;

(vii) any such other particulars as may be prescribed or which are in terms of its by-laws required to be so entered;

(b) to which shall be attached, in the case of an unincorporated asso- ciation of persons, its constitution.

(2) The register of members shall be prima facie proof of all matters recorded therein or attached thereto in accordance with the provisions of sub- section (1) and the by-laws of the co-operative.

Termination of membership of co-operatives and suspension of members

21. (1) Subject to subsections (2) and (3) -

(a) a member of a co-operative may by such notice in writing to the co- ope-rative and subject to such conditions as may be determined in the by-laws of the co-operative, terminate his or her or its member- ship of the co-operative;

(b) a member of a co-operative who has contravened or failed to com- ply with a provision of this Act or the by-laws of the co-operative on more than two occasions or who refuses to comply with an ob- Iization he or she or it has undertaken or who or which has commit-

No. 1467 Government Gazette 20 December 1996 29 Act No. 23,1996 CO-OPERATIVES ACT, 1996

(i) may, with a view to disciplinary action to be taken, be sus- pended as a member by the board for any period not extend- ing beyond the date of the first annual general meeting held subsequent to such suspension; or

(ii) may, by special resolution passed at a general meeting of the co-operative -

(aa) be suspended for a period not exceeding a period as provided in the by-laws of the co-operative, but may at any time be reinstated by the board; or

(bb) be expelled from the co-operative.

(2) A member of a co-operative who wishes to terminate its member- ship of a co-operative in terms of paragraph (a) of subsection (1) shall not be required to give notice which exceeds a period of -

(a) in the case of a primary co-operative, one year; and

(b) in the case of a co-operative of a level higher than the level of a primary co-operative, two years.

(3) (a) The by-laws of a co-operative shall contain provisions relat- ing to -

(i) the acts or omissions which constitute misconduct towards the co-operative;

(ii) the maximum period for which a member may be suspended by special resolution under subsection (1)(b )(ii)(aa);

(iii) the disciplinary steps which mayor shall be taken against a member, whether or not such member has been suspended under subsection (l)(b)(ii)(aa).

(b) A member of a co-operative shall not be expelled under subsection (l)(b)(ii)(bb), unless he or she or it has been -

(i) given prior notice in writing of at least two months of the grounds on which his or her or its expulsion is being consi- dered;

(ii) afforded an opportunity in a manner provided for in the by- laws of the co-operative to adduce facts or circumstances in rebuttal of any allegation against him or her or it or to show cause why he or she or it ought not be expelled.

30 Government Gazette 20 December 1996 No. 1467

Act No. 23,1996 CO-OPERATIVES ACT, 1996

Liability of members of co-operatives

22. In a co-operative limited by shares the liability of a member shall be limi-ted to an amount equal to the nominal value of the shares in the co- operative held by him or her or it in so far as the amount has not been paid up.

Imposition of fines upon members for contraventions of, or failures to comply with, by-laws or internal rules of co-operatives

23. (1) A member of a co-operative may be fined by the co-opera- tive for any contravention of, or failure to comply with, a provision of the by- laws or any rule of the co-operative referred to in paragraph (n) of subsection (1) of section 11, or failure to perform any duty imposed upon him or her or it by the co-operative under this Act or the by-laws or any such rule, or which he or she or it undertook to perform.

(2) A fine referred to in subsection (1) shall be imposed subject to the by-laws of the co-operative and shall not exceed a maximum amount deter- mined in such by-laws.

(3) A fine shall not be imposed in terms of subsection (1), unless the member concerned has been given prior notice in writing of the charge and particulars of the alleged contravention or failure and afforded an opportunity in a manner provided for in the by-laws of the co-operative to adduce facts or circumstances in rebuttal of the charge or to show cause why such a fine ought not to be imposed upon him or her or it.

(4) A fine imposed under subsection (1) shall constitute a debt in favour of the co-operative.

Preference of co-operatives as creditors in respect of certain debts owing by members

24. Notwithstanding anything to the contrary contained in the Insol- vency Act, 1936 (Act 24 of 1936), a co-operative shall in respect of a debt owing to it by any member for-

(a) any thing supplied or any service rendered by it to such member for purposes of producing or manufacturing any product or article which is marketed by means of or through the co-operative;

(b) any amount of money advanced to such member for any such pur- pose by the co-operative,

have a preferent claim against any balance of the free residue of such member's insolvent estate after the expenditure referred to in sections 96 to 102, inclu- sive, of that Act have been provided for as contemplated in those sections.

No. 1467 Government Gazette 20 December 1996 31 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

Agreements entered into with co-operatives by members who are minors

25. A member of a co-operative who is a minor may, without the per- mission or assistance of his or her parent or guardian -

(a) enter into any agreement with the co-operative of which he or she is a member in relation to any matter in respect of which a member may in terms of the by-laws of the co-operative enter into an agree- ment with it;

(b) enforce in any competent court of law or otherwise any rights ac- quired under any such agreement,

and shall enjoy all rights and privileges and be subject to all obligations, terms and conditions contained in or connected with such agreement as if such agree- ments were entered into by him or her with the assistance of his or her parent or guardian.

Part VI Administration of co-operatives

Postal addresses and registered offices, and chief executive officers, of co- operatives

26. (1) A co-operative shall have in Namibia-

(a) a postal address to which communications and notices may be ad- dressed; and

(b) a registered office where process may be served and where the docu- ments referred to in section 28 shall be kept

(2) A co-operative may appoint, on such conditions as may be deter- mined by it, a natural person as chief executive officer who shall be respon- sible under the direct authority of the board for the conduct of its business as a co-operative and who may, with the concurrence of the board, appoint such other natural persons as may be necessary to assist the chief executive officer in the discharge of his of her functions.

(3) A co-operative shall inform the Registrar in writing of any change of its postal address, the street address of its registered office or the description of the place where its registered office is situated and of its chief executive officer within 14 days of such change, and the Registrar shall make an appro- priate entry of such change in the register of co-operatives.

Use and publication of names by co-operatives

27. (1) A co-operative shall have-

32 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(a) the word "co-operative" or its equivalent in a language other than English, as part of its name, and if its equivalent in such other lang- uage is used as part of its name the word "Co-operative" shall fol- low in brackets; and

(b) the word "limited" or its abbreviation "Ltd" at the end of its name, if it is a co-operative having limited liability for its members.

(2) A co-operative shall -

(a) display its name in a conspicuous position and in characters easily legible on the outside of every place or office in which its business is carried on;

(b) include its name, postal address, address or place of its registered office and the number allocated to its certificate of registration on all letters and other documents addressed or issued by the co-ope- rative and its seal or any date or other stamp on which the co- operative's names is displayed;

(c) in the case of a co-operative that is provisionally registered, in- clude on all letters and documents and seal or stamp referred to in paragraph (b) and indication by the words "provisionally registered" the fact that it is provisionally registered;

(d) display its certificate of registration or a copy thereof certified to be a true and correct copy at a conspicuous place at its registered of- fice.

Copies of this Act, by-laws and internal rules of co-operatives and regis- ters of members of co-operatives to be open to inspection

28. A co-operative shall keep a copy of this Act, its by-laws, the rules regulating its internal affairs and the register of its members referred to in section 20 open to inspection to its members or auditor or to the Registrar, free of charge, at all reasonable times at its registered office.

Part VII Boards and supervisory committees

Boards of co-operatives

29. (1) The affairs of a co-operative shall be managed and controlled by a board, which shall, subject to the directions and control of the decisions of the members taken at general meetings -

(a) exercise and perform the powers, duties or functions conferred or imposed upon it or the co-operative by or under this Act or the by- l~HX1Cor rnlpc rpCfnl",t;nCf thp ;ntprn",l ",ff",;r" ofthp (,{"\_Anpro:>t;",,· o:>nrl

No. 1467 Government Gazette 20 December 1996 33

Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(b) prepare and submit, for consideration and approval, to the mem- bers of the co-operative at the annual general meeting of the co- operative, a management report on its activities in relation to the management of the affairs of the co-operative, including the au- dited financial statements for the preceding year and a program of activities and an estimate of revenue and expenditure for the co- operative in respect of its next ensuing financial year.

(2) (a) Subject to section 30 and paragraph (b) of this subsection, a board shall consist of such number of persons, but not fewer than three, as may be determined in the by-laws of the co-operative, who shall be elected as provided for in subsection (3).

(b) If, in the case of a:co-operative that has more than five women as members or if more than one-third of its members are women, whichever is the lesser, no woman is elected as a member of its board, the board shall, at its first meeting held after such election has taken place, appoint a woman who is a member of the co-op- erative and who has been designated at the annual general meeting or who is otherwise selected by the board, as a member of the board, and any such woman shall have all the rights, duties, liabilities and obligations as if she were so elected.

(3) (a) Subject to paragraph (b), the members of the board of a co- operative shall be elected, unless the by-laws of the co-operative provide otherwise, by secret ballot at a general meeting of the co- operative for such period as may be determined by the by-laws of the co-operative.

(b) At the last ordinary meeting of a board before each annual general meet-ing of the co-operative, such members of the board as may be determined in accordance with requirements laid down in the by-laws of the co-operative, but which shall not be fewer than one- third or more than two-thirds of the total number of members of that board, shall retire as members of the board, but shall -

(i) subject to paragraph (c), be eligible for re-election as any such members;

(ii) remain in office until such time as any of them or their suc- cessors have been re-elected or elected, as the case may be.

(c) A member shall not be eligible for re-election for a period exceed- ing nine consecutive years, but shall again be eligible after the elapse of a period of two years after such period of nine years.

(4) A member of the board shall receive no remuneration or allow- ances in respect of his or her services as such a member other than a hono- r!lrinm !lnthori7p.rl hv !l rp.«ohltion n~l««p..rlar anv !J"p.np.rll1meetino of the en-

34 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

operative, but the board may, in accordance with its estimates of revenue and expenditure, authorize the payment to any member of the board of any actual expenditure incurred in connection with any journey undertaken by him or her in connection with the functions of the board.

Qualifications of members of boards

30. A person shall not hold office as a member of a board -

(a) unless he or she is a member of the co-operative;

(b) unless he or she is 18 years of age or older or, in the case of a registered co-operative of which all its members are learners at a school, at least 14 years of age;

(c) if such person is the chief executive officer or any other officer in the employ of the co-operative;

(d) if such person is a corporate body or an unincorporated association of persons: Provided that a corporate body or an unincorporated association of persons may be represented on the board by any natu- ral person duly elected thereto in the manner contemplated in sec- tion 29(3) from persons nominated, in such manner as may be pre- scribed in the relevant by-laws, by such corporate body or unincor- porated association or persons;

(e) if he or she is a member of the National Assembly, the National Council, a regional authority or local authority;

(f) if he or she is in the service of any governmental body established by or under any law which is funded, whether partly or wholly, out offunds appropriated by Parliament and he or she has not obtained the necessary permission to hold such office from the governmen- tal body concerned;

(g) if his or her estate is sequestrated;

(h) if he or she has at any time been removed from an office of trust on account of misconduct;

(i) if he or she has at any time been convicted of any contravention of any provision of this Act in relation to the formation or manage- ment of a co-operative or any offence involving dishonesty;

U) if he or she has within a period of five years prior to the date of election or appointment of members of the board been dismissed fairly as an employee of a co-operative;

(k) if he or she has at anv time heen exnelled CIS nroviderl in section

No. 1467 Government Gazette 20 December 1996 35 Act No. 23,1996 CO· OPERATIVES ACT, 1996

(1) if he or she is not qualified by virtue of the by-laws of the co-opera- tive concerned to hold such office.

Vacation of offices by members of boards, and filling of casual vacancies

31. (1) A member of the board shall cease to hold office as a mem- ber of such board if he or she -

(a) becomes incompetent in terms of section 30 to hold such office as member of such board;

(b) has absented himself or herself from three consecutive meetings of that board without the leave of the board;

(c) resigns by notice in writing;

(d) accepts any remuneration or allowances from the co-operative other than a honorarium authorized as provided in section 29(4);

(e) is removed from office under subsection (2).

(2) Amember of the board may at any time be removed from office by special resolution by the co-operative and in respect of which due notice has been given of the intention to move such a resolution

(3) Any vacancy on the board arising from a circumstance referred to in subsection (1) and every vacancy caused by the death of a member may be filled by the appointment of any other competent person by the board in such manner as may be provided in the by-laws, and every member so appointed shall hold office for the unexpired portion of the period of office of the vaca- ting members.

Office bearers of boards

32. (1) One member of the board elected in terms of section 29(3) shall, in such manner as may be provided in the by-laws of the co-operative, be elected as the chairperson, and two other such members shall be so elected as the vice-chairperson and secretary of the board.

(2) When the chairperson of the board is absent or is unable to perform his or her functions as chairperson, the vice-chairpeson shall act as chairper- son during the absence or incapacity of the chairperson, or, if both the chair- person and the vice-chairperson are absent or unable to perform the functions of the chairperson, the board may elect any other member to act as chairperson during such absence or incapacity, and such member shall, while he or she so acts, have all the powers and shall perform all the duties and functions of the chairperson.

36 Government Gazette 20 December 1996 No. 1467 Act No. 23, 1996 CO-OPERATIVES ACT, 1996

(3) (a) The chairperson of the board of a co-operative shall, subject to his or her remaining a member of the board, retire as chairperson at the first meeting of the board held subsequent to an annual ge- neral meeting, but shall be eligible for re-election.

(b) The provisions of paragraph (a) shall mutatis mutandis apply to the vice-chairperson and secretary of the board.

Meetings of boards

33. (1) (a) Subject to paragraph (b), a meeting of the board of a co-operative shall be held on at least four occasions during the fi- nancial year of the co-operative at a time and place determined by the chairperson.

(b) The chairperson shall on a reasoned request in writing by at least one-third of the members of the board or by the supervisory com- mittee of the co-operative convene a special meeting of the board.

(2) A majority of all the members of a board of a co-operative, or such larger number of such members as may be determined in the by-laws of a co- operative, shall form a quorum for a meeting of tre board.

(3) A decision ofthe majority of the members ofthe board present and voting at a meeting of the board, or such larger number of such members so present and voting as may be determined in the by-laws of the co-operative, shall be a decision of the board: Provided that in the event of an equality of votes the chairperson shall, in addition to his or her deliberative vote, have a casting vote.

(4) No decision taken by the board or act performed under the autho- rity of the board shall be invalid by reason only of -

(a) a vacancy on the board;

(b) the fact that a person who is not entitled to sit as a member sat as a member;

(c) the fact that a person who was entitled to be elected, appointed or co-opted was not so elected or appointed or co-opted,

at the time when the decision was taken or the act was authorized, if the deci- sion was taken or the act was authorized by the requisite majority of the mem- bers who were present at the time and entitled to sit as members.

Minutes of meetings of boards

34. (1) The board shall cause minutes to be kept of all proceedings . ..•.•.•. ~+-ro ~~~~+-._~~ 4- _ L .•. ...::I _ _ _ _ _ __ -

No. 1467 Government Gazette 20 December 1996 37

Act No. 23,1996 CO-OPERATIVES ACT, 1996

date of its next consecutive ordinary meeting, in one or more books to be kept for that purpose at the registered office of the co-operative.

(2) The minutes of any meeting of the board signed by the chairperson of the board shall in any court be prima facie proof of the taking place of anything which according to such minutes took place at such meeting.

Liability of members of boards

35. A member of the board or its chief executive officer or other officer of the co-operative shall not be liable to any person in his or her personal capacity for any loss or damage which may occur in or in connection with the performance of his or her duties, unless -

(a) the loss or damage is due to his or her wilful misconduct, disho- nesty or gross negligence or to the fact that he or she wilfully con- travened or that he or she refused to comply with a provision of this Act or the by-laws or rules regulating the internal affairs of the co- operative and such loss or damage is not covered by a fidelity gua- rantee policy or any other similar policy taken out by the co-opera- tive; or

(b) the loss or damage is due to his or her reckless conduct, or conduct which is or was intended to defraud any person or for any other fraudulent purpose,

in which case he or she shall be liable in his or her personal capacity without any limitations or liability.

Subcommittees of boards

36. (1) If provision is made in the by-laws of a co-operative for the establishment and constitution of subcommittees of the board, any such sub- committee shall -

(a) have at least one member of the co-operative who is not a member of the board;

(b) in the case of a co-operative that has more than 20 women as mem- bers or if more than one-third of its members are women or the members who are women represent more than three percent of the total number of its members, whichever is the lesser, have at least one woman,

as a member of such subcommittee.

(2) If no woman is, in terms of paragraph (b) of subsection (1), elected or appointed as a member of the subcommittee, the subcommittee shall, at its +'r