Cooperative Societies Proclamation No. 985/2016

 

PROCLAMATION No. 985/2016

COOPERATIVE SOCIETIES  PROCLAMATION

WHEREAS, it has become essential to  establish  and manage cooperative societies for  those persons with common interest by bringing together their finance, knowledge, resource and labour voluntarily to meet their common economic, social and cultural needs and other aspirations which would then allow mutual support and create savings;

WHEREAS, cooperative societies are required to contribute to the country’s economic and social development, and to be nationally and globally competent   creation of an employment opportunities through supporting production and productivity increment in both rural and urban settings, value addition on members produce, creating financial and market linkage, shortening unnecessary market chains, in the way helpful to sustain one economic community in accordance to our constitution;  through a uniform cooperative societies proclamation ;

WHEREAS, it has become necessary to cause the cooperative societies to play pivotal role in the free market economic system by maintaining their guiding principles and unique features;

WHEREAS, it is necessary to establish and strengthen cooperative societies that are directed and managed by members and also ensure their rights, owners and benefits of them;

WHEREAS, it has become necessary to promulgate laws on establishment and management of cooperative societies by replacing existing cooperative societies proclamation, in order to  achieve the objectives of the cooperative society;

            NOW, THEREFORE, in accordance with the  provisions of Article 55 (6) of the Constitution of the Federal Democratic Republic of Ethiopia, it is hereby proclaimed as follows:

 

PART ONE

General

1.  Short Title

    This Proclamation may be cited as the “Cooperative Societies Proclamation No. 985/2016”.

 

2.  Definitions

In this Proclamation unless the context otherwise requires:

 

    1/    “cooperative society" means an autonomous association having legal personality and democratically controlled by persons united voluntarily to meet their common economic, social and cultural needs and other aspirations, which could not addressed individually, through an enterprise jointly owned and operated on the basis cooperative principles;

 

 

 

2/        “primary cooperative society" means a cooperative society established by individuals having similar interest and objective with a minimum number of members prescribed in this Proclamation to produce, provide service or to engage in both activities;

3/        “cooperative societies union” means a secondary level cooperative society established by primary cooperative societies having similar objective with a minimum number of members as prescribed in this Proclamation to produce, provide service or to engage in both activities that are beyond the capacity of primary cooperative societies;

4/        “cooperative societies federation” means a tertiary level cooperative society established by cooperative society unions having similar objective with a minimum number of members prescribed in this Proclamation, to produce, provide service or to engage in both activities that are beyond the capacity of cooperative society unions;

 

5/        “cooperative societies league” means a league which represents primary cooperative societies, cooperative society unions and cooperative society federations operating in Ethiopia;

6/        "multi-purpose cooperative society" means a society established to engage in production and service delivery activities for its members;

 

7/        “saving and credit cooperative society” means a society established to provide saving, credit and loan-life-insurance services to its members;

 

 

8/        “loan-life-insurance” means an insurance given by a cooperative society to its members to cover loan taken by a deceased member before full repayment of debt;

 

 

9/        “cooperative’s societies working area” means an area stated in cooperative society’s by-laws and registered by appropriate  authorities;

10/      “member” means any individual or a primary cooperative society or a cooperative societies union or cooperative societies federation who applied and admitted for membership upon fulfilling the minimum membership requirements that are determined in the by laws by taking into account the nature of the cooperative society;

 

11/      “General Assembly” means a meeting of individual members or their representatives at primary cooperative society or representatives of primary cooperative societies, cooperative societies unions or cooperative societies federations when it is above primary cooperative society;

 

 

12/      “representative” means as prescribed in the by-law of the cooperative society with regards representation, an individual in primary cooperative societies, represented by members to vote in general assembly, or in cooperative unions and federations elected  by General Assembly of the cooperative society to represent and vote for in any General Assembly of the cooperative society;

 

 

13/      “by-laws” means the law governing a cooperative society including amendments made to it and approved by two third vote of the General Assembly and registered by appropriate body upon fulfilling particulars specified under Article 12 of this Proclamation;

 

14/      “special resolution” means a resolution passed by a two third majority of the members of the cooperative society to be binding on all members;

15/      "management committee" means a body elected and empowered by the general assembly with the responsibility to manage the activities of a cooperative society;

16/      “manager” means an officer accountable to the management committee and operates the day-to-day activities of the cooperative society within the limit of the powers and responsibilities entrusted to it;

17/      “worker” means an individual who has an employment relationship with the employer cooperative society to perform day-to-day activities in accordance with the agreement reached in the contract of employment;

18/      “reserve fund’’ means part of annual surplus retained and reserved by cooperative societies in accordance with the law and not distributed as dividend to members;

19/      “capital” means the amount of asset accumulated after deducting liability of a cooperative society, and it includes share of the members, reserve fund, donation, inheritance, and funds prescribed by by-laws and investments;

20/      “appropriate authority” means the Federal Cooperative Agency, or an organ established at regional levels to execute the cooperative societies proclamation, lead and regulate the cooperative sector;

 

 

 

21/      “region” means any state referred to in Article 47 (1) of the Constitution of the Federal Democratic Republic of Ethiopia and includes the Addis Ababa City Admin istration and  Dire Dawa Administration;

22/ “copoperative societies fund” means a type of fund established to achieve copperative societies jont benefit for education or training or audit service or incentive, or research and development or legal service or for promotion and communication, and for social services purpose by pulling incomes from cooperatives net income as decided after audit by the general assembly, and also income from gift or hire or different project initiatives or support and income from different income generating activities and other incomes pulled from common indivisible money and asset remained after the liquidation of cooperative societies;   

23/ “Payment of shares” means the declared  share having par value and serve members as precondition for membership paid prescribed in cash or in kind; 

24/      “person” means a natural or juridical person;

25/      any expression in the masculine gender includes the feminine.

3.   Scope of application

This proclamation shall apply to cooperative societies established in the country.

 

4.  Objectives of a Cooperative Society

 

A cooperative society established pursuant to this Proclamation shall have any one or more of the following objectives:

 

1/        to collectively overcome, withstand and solve economic and social problems which members cannot individually achieve;

2/        to achieve a better result by coordinating members’ knowledge, resource and labor;

3/        to promote self-reliance among members;

 

4/        to reduce production and service costs and to offer inputs and services to members  with lower costs and finding better market prices to their  products or services;

 

5/        to expand situations by which technical knowledge could be put into practice and promote entrepreneurship;

 

 

6/        to develop and promote saving culture between members;

7/        to provide loan to members and promote investment;

8/        to provide loan-life- insurance coverage to members;

9/        to minimize and reduce damage and lose of each individual members, if it had been undertaken individually, by sharing it to members;

10/ to develop the social and economic capacity and culture of the members through education and training.

5.                  Guiding Principles of Cooperative Societies

1/        Cooperative societies shall be voluntary organizations open to all persons willing to use their services and able to accept the responsibilities of membership without discrimination on the basis of gender, social status, race, political ideology, disability or religion.

2/        Cooperative societies shall be democratic organizations controlled by their members who actively participate in setting their policies and making decisions; each member having equal voting right as well as one member having only one vote.

 

 

3/        Members shall receive dividends from surplus according to their shares and participation after deducting and setting aside an amount necessary for reserve and other services.

4/        Cooperative societies shall, when enter into agreement with other organizations including government or raise capital from external sources, do so on terms that ensure democratic control by their members, maintain their autonomy and do not affect their self-help characteristics.

 

 

5/        Cooperative societies shall provide education and training for their members, elected representatives, managers and employees so as to enable them to contribute effectively to the development of their societies and, advertize to the public at large particularly to the youth about the nature and benefit of societies.

 

6/        Cooperative societies shall serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.

7/        Cooperative society shall work for the sustainable development of their community through policies approved by their members.

 

 

 

6.                  Values of the Cooperative Societies and their Members

1/        The values of the cooperative societies shall be:

a)                 self-help;

b)        self-responsibility;

c)         promoting culture of democracy;

d)        equality;

e)         equity; and

f)         Solidarity.

 

2/        The ethical values of the members of the cooperative societies shall be:

 

a) honesty;

 b) openness;

 c) accountability;

d) participatory ;

e) social responsibility; and

f) caring for others.

 

 

PART TWO

Formation and Registration of Cooperative Societies

 

7.                   Formation of Cooperative Societies

1/     Cooperative societies may, according to their nature, be established at different levels from  primary  up  to  federation  level.

 

2/        The primary cooperative society shall be established:

a)                 by individuals who live or work or engaged in specific profession within a given area; and

 

b)                 by number of members not less than fifty.

3/        Notwithstanding paragraph (b) of sub-article (2) of this Article, the appropriate authority may specify in the directive the minimum number of members of a society based on the nature of the work and economic feasibility; provided, however, that the minimum number of members shall not be less than 10.

 

 

4/        Primary cooperative society established at federal level shall consist members from two or more regional states.

5/        The appropriate authority shall establish and register cooperative societies at federal or regional levels.

 

8.                   Type of Cooperative Societies

1/        A cooperative society may be established to engage in production or service rendering activities or both in production and service rendering activities.

 

2/        Without the prejudice to the provision of sub-article (1) of this Article, types of cooperative societies to be established shall not in the areas prohibited by law, immoral to public values, activities affecting environmental security, hence the appropriate authority shall give professinoal support after conducting due socio-economic study in order to identify the potential resources a vairable to organize cooperative societies.

 

9.                  Name of a cooperative Society

1/        Any cooperative society shall have its own name; and such name shall be rational, does not contravene law and public morality.

2/        The phrase “Cooperative Society with Limited Liability” shall appear in the end of the name of any cooperative society.

3/        No similar and misleading name or distinguishing mark shall be used by another cooperative society within the same operation area of a registered name or distinguishing mark of a given cooperative society.

 

 

4/        The name of any cooperative society shall be written boldly and be put at every place where the cooperative society's activities are performed.  It shall also be written or sealed on any notices, letters, other statements and documents which are signed on behalf of the cooperative society.

5/        No person may use the name “Cooperative Society” without obtaining permission from the appropriate authority.

10.             Registration of a cooperative society

1/        Any cooperative society shall be registered by the appropriate authority.

2/        Any cooperative society, to get registered as a cooperative society, shall submit an application for registration together with the following particulars to the appropriate authority:

 

a)          minutes of the founders meeting;

b)        the by-laws of the cooperative society in three copies;

c)         names, address and signature of the members of the management committee of the  cooperative society;

 

d)        name, address and signature of the members of the control committee of the cooperative society;

 

e)         a detailed description which proves that the registered members of the cooperative society have met the requirements for membership in accordance with the provisions of this Proclamation and the by-laws of the cooperative society;

 

f)         if the cooperative society is of a higher level than  the primary cooperative society, the name and address of the member primary cooperative societies and signature of their representatives;

g)         three up to five years action plan of the society;

h)        documents showing the amount of initial capital of the society and the capital that has been collected and deposited in a bank account, if there is no bank in the area, that it has been deposited in a Financial Institution where the appropriate authority has designated;

 

i)          the description of the place at which the cooperative society operates;

j)          other particulars that may be specified in the regulations or directives issued hereunder;

 

3/        The appropriate authority shall register the cooperative society and issue a certificate of registration within five consecutive working days when it is satisfied that the application for registration submitted to it has fulfilled the requirements for registration. The date of registration of the cooperative society as a cooperative society shall be recorded on the certificate of registration.

       

4/        When the appropriate authority rejects the application for the registration of a cooperative society, it shall give a written explanation to the representatives of the cooperative society starting from the date of application within five consecutive working days. 

5/        If representatives of the cooperative society have grievance on the written decision of the appropriate authority given pursuant to sub-article (4) of this Article, they may lodge petition, to the appropriate Regional Court, if it is at regional level and to the Federal High Court, if it is at federal level, within 60 consecutive days to high court which has jurisdiction.

6/        The certificate of registration issued to a cooperative society pursuant to sub-article (3) of this Article shall be a sufficient evidence to prove that a cooperative society is registered in accordance with this Proclamation.

7/        Any cooperative society which has been legally registered pursuant to sub -article (3) of this Article shall engage in business in accordance with its objectives and activities endorsed in its by-law as of the date of registration without the need to secure additional business license.

 

8/        Where the appropriate authority ensures that requirements indicated under paragraph (a) to (h) of sub-article of this Article are met, it shall grant temporary certificate which may serve not more than a year and shall cause the rest requirements to be observed within a specified period of time.

9/        Where any cooperative society is found operating out of the objectives and principles for which it is established, the appropriate authority may suspend it from carrying out activities permitted by this law.

 

 

 

10/      Whereas the cooperative society suspended pursuant to sub-article (9) of this Article fails to apply within 30 consecutive days to lift up the suspension, the appropriate authority may take legal liquidation measure.

11/      Where the General Assembly of a cooperative society suspended pursuant to sub-articles (9) of this Article submits its request to lift up the suspension and where the appropriate authority found the request appropriate, it may lift up the suspension. If the appropriate authority doesn’t lift up the suspension, it shall give a written explanation. Any party dissatisfied by the decision rendered at the federal level may lodge petition to The Federal High Court or if the decision is rendered at regional level may lodge petition to the appropriate court which has jurisdiction.

 

 

11.             Juridical Personality and Responsibility

1/        Any cooperative society registered in pursuance of Article 10 of this Proclamation shall have juridical personality from the date of its registration.

2/        Any cooperative society shall not be liable beyond its total asset; and it has limited liability.

12.             By-laws of a Cooperative Society

1/        Any cooperative society shall have its own by-laws; and the contents of the by-laws shall include the following particulars:

 

a)         name and address of the cooperative society;

b)        objectives and activities of the cooperative society;

c)         working place and area of the cooperative society;

d)        requirements necessary for membership of the cooperative society;

e)         the rights and duties of members of the cooperative society;

 

f)         the powers, responsibilities and duties of management bodies;

g)         conditions for withdrawal and dismissal from membership;

h)        conditions for election, appointment, term of office and suspension or dismissal of the members of the management committee or other management bodies;

i)          conditions for calling of meeting and voting procedures of the cooperative society;

j)          allocation and distribution of profit;

k)         auditing;

l)          employment of workers;

 

m)       other particulars not contrary to this proclamation, and regulation and directive for the implementation of this proclamation.

 

 

 

2/        By-laws of a cooperative society may be amended by the special resolution of the general assembly; provided, however, that the amendment of the by-laws of the society shall be effective on the date of its submission to and registration by the appropriate authority.

 

3/        Where the cooperative society decides on the amendment of its by-laws three copies of the amendment and the special resolution of the cooperative society general assembly made in accordance with this Proclamation shall be submitted to appropriate authority within 15 consecutive working days from the date of the decision. If the by-law amended is not submitted to appropriate authority within the specified period it shall not be accepted.

 

4/        The appropriate authority shall register the amendment to the cooperative society where it is satisfied that the amendment of the by-laws specified in sub-article (3) of this Ariticle was made in accordance with this Proclamation and regulation and directive issued for the implementation of this Proclamation, and give evidence of its registration within five consecutive working days.

 

5/        If the appropriate authority fails to register the amendment or fails to notify the cooperative society the reasons for not registering within five consecutive working days, the amended by-laws shall be considered as registered and put to practice.

 

6/        Any cooperative society shall include principles and values of the cooperative society in its by-laws.

7/        Any cooperative society shall include requirements necessary to encourage participation of female members in the management committee of the society.

 

8/ any cooperative society shall include activities to increase the active participation of women, youth and the disabled in their strategic and annual plans.

13.             Amalgamation and Division of Cooperative Societies

1/        The general assembly of a cooperative society through a special resolution may;

a)                 divide itself  into two or more cooperative societies, or

 

b)                 amalgamate with one or more cooperative societies and  form a new cooperative society.

2/        The special resolution on the amalgamation or division of a cooperative society shall be effective upon verifying that:

a)                 the members and creditors of the cooperative society are agreed on the amalgamation or division;

 

 

 

b)                 the members and creditors that did not agree have been paid off or the payment guarantee determined in the special resolution is registered by appropriate authority;

c)                  the registration of the former cooperative societies or  cooperative society has been canceled from the register and the newly amalgamated or divided cooperative societies are registered.

3/        The rights and duties of cooperative societies which have lost their identities by amalgamation shall be transferred to the newly formed cooperative society as specified in the special resolution passed pursuant to sub-article (2) of this Article.

 

4/        The rights and duties of a cooperative society which has lost its identity by division shall be transferred to the newly formed cooperative societies as specified in the special resolution passed pursuant to sub-article (2) of this Article.

14.             Establishment of Cooperative Societies Union

1/        A cooperative societies union shall be establish by two or more primary cooperative societies having similar objectives.

2/        Cooperative societies union may be established at the federal or regional levels based on their social and economic feasibility.

 

3/        The members of a cooperative societies union established at federal level shall be drawn at lest from two regional primary cooperative societies.

15.             Establishment of Cooperative Societies Federation

 

1/        Cooperative societies federation shall be established by two or more cooperative societies unions having similar objectives.

 

2/        Where it is socially and economically feasible, cooperative societies’ federation may be established at federal or regional levels.

3/        The members of a cooperative societies federation to be established at federal level shall be two or more than two cooperative societies unions drawn at least from two regional cooperative societies unions

 

16.             Requirements to Establish a Professional Cooperative Society

 

1/        If any primary cooperative society is established based on the members profession, such members shall produce evidence of occupational competence certificate from the appropriate authority.

 

2/        pursuant to sub-article (1) of this Article, the occupational competence certificate produced for professionals carrier shall be those activities obliged  by law.

3/ Professional cooperative societies shall present quality assurance certificate for their value added products they produce or services they provide.

 

17.             Establishment of Cooperative Societies League

1/        Subject to the provision of this Proclamation and that of other relevant laws, primary cooperative societies, cooperative society unions and federations may establish a league that represents all cooperative societies in Ethiopia.

2/        The number of the league established pursuant to sub-article (1) of this article shall not exceed one.

3/        The establishment, functions and financial sources of cooperative societies’ league shall be determined by the council of ministers regulation.

18.             Obligations of Cooperative Societies

The cooperative societies shall have the following obligations:

1/  provide services to their members according to the plans uphold;

2/        protect the rights of employees of the cooperative society according to the labor law of the country;

 

3/        except income tax cooperative societies shall pay the necessary payments to government according to the law and on time;

 

4/        respect and work according to the by-laws;

 

5/        provide the necessary information to the appropriate  body at request time;

 

6/        operate only by upholding the principle and purpose for which it is established.

19. Commencement of Operations

 

1/ A cooperative society fails to commence operation in accordance with its plan within six months after its registration shall be given a written notice so as to commence within three months.        

 

2/        When a cooperative society fails to commence operation within the notice period given pursuant to sub-article (1) of this Article, upon liquidation and decision on its dissolution, its registration shall be cancelled and  lose its legal personality.

20.             Renewal of Certificate Registration

1/        Any cooperative society shall renew its certificate of registration every three years starting from its establishment in accordance with this proclamation and the date of its registration with the directive issued by the appropriate authority.

 

 

2/        The appropriate authority shall take measures in accordance with the directive on any cooperative society that fails to renew its certificate of registration pursuant to sub-article (1) of this Article.

 

21.             Duties and Responsibilities of Cooperative Societies

  1/      Cooperative societies, within their respective levels, shall have the duties and responsibilities provided for under sub-articles (2) to (9) of this Article.

2/        Primary cooperative societies shall, mainly, engage in activities that are beyond the capacities of individual members and solve common economic and social problems and in particular shall include the following:

 

 

a)                 provide awareness creation to the local community on the concept of cooperative society and promote same;

 

b)                 participate on environmental development  and  protection  activities;

 

c)                  provide pre and post harvest training to members in respect of quality products;

 

 

d)                 provide warehouse service to members;

 

e)                 design projects intended to solve members problem;

 

f)                   collect members product, add value and  submit to their union or federation, or sale by searching for better market outlets;

g)                 perform other activities described in their by-laws.

3/        Cooperative societies unions shall, mainly, engage in activities that are beyond the    capacities of member primary cooperative societies and solve common economic    and social problems and in particular shall include the following:

 

a)                 provide training to members in their area of engagement;

 

b)                 provide advisory service to member primary cooperative societies;

 

 

c)                  provide market information service to member primary cooperative societies;

d)                 facilitate market linkage to member primary cooperative societies;

 

e)                 provide warehouse service;

 

f)                   supply in a wholesale inputs that boost product and  consumer goods;

 

 

g)                 add value on members product and perform other activities as described in their by-laws.

4/        Cooperative societies federations shall, mainly, engage in activities that are beyond the capacities of member cooperative unions and solve common economic and social problems and in particular shall include the following:

a)                 arrange and provide audit service to member cooperative societies unions;

 

b)                 represent cooperatives societies unions on their affairs to lobby and advocate Government and stake holders;

c)                  promote cooperative ideology and build image of cooperative societies and thereby expand cooperative societies;

 

d)                 create and strengthen national and international cooperative societies relationship;

e)                 participate on  national and international wholesale marketing  activities which are beyond the capacity of primary and union cooperative societies;

 

f)                   establish or capacitate  members to establish different industries that add value;

 

 

g)                 conduct practical research and study on cooperatives societies;

h)                 provide advisory service to member cooperative societies union;

i)                   develop human resource capacity of cooperative sector;

 

j)                   develop information exchange mechanism between national and international cooperative societies;

k)         establish and administer cooperative societies fund;

l)          provide financial and technical assistance to cooperative society activities;

 

m)       coordinate and support infrastructure development for cooperative societies;

 

 

n)        carry out other activities described in their by-laws.

 

 

5/        Cooperative societies established at union or federation levels shall not engage in the same activity as their members without adding value to the goods or service they provide.

 

6/        Any cooperative society shall have the responsibility to sell the product it collected from its members in the same production year with the prevailing market price.

7/        The cooperative societies shall have responsibility to protect, develop and give due care for environment while conducting their activities not to cause damage to environment and human wellbeing.

8/   any cooperative society shall deliver Micro insurance service to it`s member in the following manner,

 

a)                 the cooperative society may enter insurance agreement for its own or its member asset;

 

 

b)                 on the request and consent of its member provide micro insurance service for crop, animal or for other produces to avert risk or enter into agreement as agent of the insurance company; or

 

c)                  The cooperative society may give micro insurance for loan life insurance service or enter insurance agreement for its member.

 

 9/ saving and credit cooperate society collect member saving, provide credit, and also  provide micro credit life insurance service for members loan or saving  or for future saving, based on contractual agreement, for the amount of premium paid money by saving and credit cooperative society.

 

10/ pursuant to sub-article (8) and (9) of this Article detail implantation shall be prescribed by regulation issued by the Council of Ministers.

22.             Initial Capital

1/        Any primary cooperative society shall be established with an initial capital that covers at least one year operation cost based on its plan and feasibility study

 

 

2/        Any cooperative societies union shall be established with an initial capital of at least 25% raised from member cooperative societies through special resolutions of general assembly to implement plan developed for the union based on a feasibility study.

 

3/        Any cooperative societies federation shall be established with an initial capital of at least 30% raised from member unions through special resolutions of general assembly to implement plan developed for the federation based on a feasibility study.

 

 

 

 

 

23.              Provision of  Services to Non-members

1/        The conditions under which cooperative societies give service to non-members shall be based on contract and for the following purposes:

 

 

a)                 distributing inputs supplied by government to increase productivity and production;

 

 

b)                 distributing consumable products supplied by government to balance supply and demand;

 

c)                  distributing revolving funds and social service to the society availed by different development partners;

 

d)                 supply agricultural inputs and collect agricultural products from farmers engaged in farming.

2/        The details shall, for the implementation of sub-article (1) of this Article, be determined in the by-laws of the cooperative society.

 

PART THREE

rights and Duties of Members of a cooperative Society

24.             Requirements Necessary for Member ship in a Cooperative Society

1/        Any person who meets the requirements specified under sub-article (2) and (3) of this Article may become a member of a cooperative society.

2/        If the membership is for primary cooperative society, the individual:

a)                 has attained the age of 18;

 

               b)       is able to pay the share capital and registration fee required by the cooperative society;

              c)         has accepted the objectives of the cooperative society and its by-laws and willing to discharge his obligation;

 

 

d)  fulfills other requirements specified in the regulations and directives issued for the implementation of this Proclamation.

3/        If the membership is for a cooperative society above a primary cooperative society, the member shall be a cooperative society registered by the appropriate authority and have legal personality.

 

25.             Rights and Duties of Members

1/        Any member of a cooperative society shall have the following rights:

a)                 to obtain services and benefits proportionate to his participation in the cooperative society;

 

 

b)                 the member or representative to participate in the meetings of the cooperative society and to vote;

 

c)                  the member or representative to participate in the General assembly to elect and be elected;

 

d)                 to withdraw from the cooperative society on his request upon securing his rights and benefits.

e)  the member of a cooperative society shall have the right to obtained any information about the activities of cooperative societies’

2/ Any member of a cooperative society shall  have the following obligation:

 

a)                 to respect the by-laws, directives and decisions of the cooperative society;

b)                 to perform activities which ought to be performed in accordance with the by-laws and directives of the cooperative society;

c)                  to protect the common property of the cooperative society;

 

d)                 to conduct transaction of products or services with the cooperative society in accordance with the contractual agreement or as determined in the by-laws of the cooperative society ;

 

e)                 to respect the Proclamation, the regulations and directives issued pursuant to this Proclamation.

 

26.             Dismissal from membership

1/        Any member of a cooperative society may leave the cooperative society on his own initiative.

2/        Any member of a society may leave the cooperative society when it is decided by the general assembly to dismiss him from the cooperative society because of committing repeated faults or disobedience.

 

3/        The rights of any dismissed member shall be respected in accordance with the by-laws of the cooperative society.

 

4/        Any member of a cooperative society who left the cooperative society on his own initiative; reapply may become a member if he obtains the approval of the management committee after one fiscal year.

 

5/        Any member of a cooperative society who has been dismissed for failing to meet his obligations; reapply may become a member, if he obtains approval of the general assembly after one fiscal year.

 

6/        in relation to cooperative society who has been dismissed because of criminal conviction ; may be accepted as a member, after five fiscal years from the date of his dismissal, if he obtains the approval of the general assembly.

 

 

 

7/        Without prejudice to the provisions of this Proclamation, any member dismissed may reapply for membership; provided, however, a member dismissed in accordance with sub-article (5) and (6) of this Article may become a member of the society only if he obtains the approval of the general assembly.

 

 

 

27.             Payment of Shares

 

1/        Any cooperative society shall, after securing the decision of the general assembly, sell approved number of shares that shall have equal par value with the view to enable the society to obtain capital necessary to start its function.

 

2/        Any cooperative society shall collect, upon its formation from the members at least one fifth of the amount of the share that the general assembly has decided to be sold. And it shall sell the rest of the shares to members within four years as of the time of its establishment.

3/        where the need for additional capital is arose, upon completion of the sale of shares decided by the general assembly it may decide once again for the sale of additional shares in accordance with Sub article (1) of this Article.

 

4/        The share that the cooperative society sells may be sold either in cash or in kind. Shares paid in kind shall be determined by the by-law of the cooperative society.

 

 

5/        No primary cooperative society member shall hold more than 10% of the total share sold by the decision of the general assembly.

 

6/        Any member of a cooperative society union and federation shall not hold more than 50% of shares out of those that the general assembly decided to be sold.

7/        If the value of shares prescribed in the name of any member are not sold within four years, it shall be presented for special decision of the General Assembly.

 

8/        If the value of shares are not presented for the special decision of the General Assembly, to be sale the appropriate authority shall cause adjustment of the financial statement of the cooperative society.

 

9/        The members of the cooperative society retaining value of shares prescribed in their names but not sold within four years shall be subject to pay interest pursuant to the prescribed in the by-laws of the cooperative society. The member shall be subject to pay the loss incurred based on the evidence provided.

 

28.             Organizing Register of Members

1/ Any cooperative society shall organize and keep register of members.

2/        The register to be organized pursuant to sub-article (1) of this Article shall contain    the following particulars:

a)                 When it is primary cooperative society, the name, address, occupation, age and sex of each member; where it is above primary coopretive society, the name, address, date of establishment and kind of work field the cooperative society holds.

b)        the date on which he became a member or ceased to be a member;

c)         the amount of shares held and the registration fee paid by each member;

d)        any other particulars that may be specified in the by-laws.

 

 

 

29.             Voting

1/        decisions of any cooperative society shall pass by majority vote (50+1) ,where issues need special resolutions must  pass by two third members vote.

2/        Any member shall, regardless of the number of shares he has, have only one vote at the meeting of the cooperative society;

 

 

 

3/        Any member in a primary cooperative society shall personally be present at the meeting of the society to cast a vote; provided, however, if the number of members of primary cooperative society is more than 500, voting may be conducted by representatives.

 

 

4/        Particulars as to representation in cooperative society shall be determined in the directive issued by the appropriate authority.

5/        Members of a cooperative society above primary cooperative society shall cast a vote through their representatives.

 

6/        There shall be at least one representative of a member cooperative society in any general assembly of cooperative society unions and federations as it is prescribed in their by-laws. Particulars of the representation shall be specified in directive to be issued by the appropriate authority.

 

 

 

 

7/        Particulars as to election of management committee members of cooperative society union and federation shall be determined in their by-laws.

 

 

30.             Transfer of share or benefit

1/        A member may transfer the share or benefit he holds in a cooperative society if:

 

 

a)                 the member has held such share or benefit for at least three years; and

 

b)                 the transfer is permitted by the management committee.

 

 

2/        On the death of a member of a primary cooperative society, his share or benefit shall be transferred to one of his heirs designated as such in the register of cooperative society or failing such designation to his legal heir at law, and where such heir is a member or is willing to be a member.

 

3/        Where such heir is not a member and does not wish to become or is not allowed to be admitted as a member, he shall be paid the value of the share or benefit of the deceased member.

 

 

 

4/        If the shares or benefit to be transferred to a member under sub-article (2) of this Article are found to be beyond the limits prescribed in Article 27 (5)  of this Proclamation, the member shall be paid the difference in cash.

5/        The transfer or payment concluded in pursuance of sub-article (2) of this Article shall not be reversed due to the claims raised by third parties on the cooperative society.

PART FOUR

Management bodies AND EMPLOYEES OF THE COOPERATIVE SOCIETY

 

31.             Supreme Organ of a Cooperative  Society

      The supreme organ of any cooperative society shall be the general assembly.

32.             Powers and Duties of the General Assembly

The general assembly of a cooperative society shall have the following powers and duties:

1/        pass decisions after evaluating the general activities of the cooperative societies;

 

2/        approve and amend the by-laws and internal regulations of the cooperative society;

3/        elect and dismiss the members of the management committee, control committee and other members of sub-committees;

4/        determine the amount of shares of the cooperative society;

5/        decide the distribution of the annual net profit of the cooperative society;

6/        review and give decision on the audit report;

7/        hear work reports and give proper decision;

 

8/        decide in accordance with this Proclamation on the amalgamation of the cooperative society with another cooperative society or its division into two or more or  dessolution of  the cooperative society  by the general assembly  special resolution ;

9/        approve the annual work plan and budget of the cooperative society;

10/      approve members admission or dismissal from membership based on the report submitted by the Management Committee;

11/      decide, in accordance with the powers vested in it by the by-law, on any issue submitted to it by the management committee and other committees.

33.             Calling of General Assembly

 

1/        The general assembly shall meet at least twice in a year.

 

2/        If the management committee decides by a majority vote or if one-third of the members of the General Assembly requires a meeting to be called, an emergency general assembly may be held by giving 15 days prior notice.

3/        Where the management committee fails to call an emergency general assembly meeting in accordance with sub-article (2) of this Article in response to the request of one-third members of the general assembly; such emergency general assembly called by the appropriate authority shall be presumed as an emergency general assembly called by the Management Committee.

 

4/        There shall be a quorum of cooperative society where:

a)                 more than half of the members or representatives of the cooperative society are present during the regular meeting of the general assembly;

b)                 two-third of members or representatives of the cooperative society are present during emergency meeting of the general assembly.

 

 

 

 

 

 

 

34.             Management Committee

1/        Any cooperative society shall have a management committee which are loyal and  respectful and also can overcome their  responsibility and  accountable to the general assembly and whose members and manner of election to be determined in the by-laws of the cooperative society.

 

 

 

2/        The term of office of the management committee shall be three years.

3/        Members of the management committee of any cooperative society shall not be elected for more than two consecutive terms; provided, however, the management committee member may be re-elected after one fiscal year after he left office upon completion of his term.

 

 

 

4/        Members of management committee of any cooperative society may be dismissed at any time by the general assembly.

5/        When members of the management committee leave their office for whatever reasons, they have obligation to cause inspection of the activities they performed during their term of office.

 

 

 

6/        The election of management committee members shall be conducted starting from the second election year by replacing at least one third of the members every year; the particulars as to election of management committee members of any cooperative society shall be determined by the directive of the appropriate committee.

 

7/        Where there is possible number of female at least 30% of any cooperative society management committee shall be held by female members.

35.             Powers and Duties of the Management Committee

The powers and duties of the management committee shall be determined in pursuance of the by-laws of the cooperative society and in particular shall include the following:

 

1/        maintain the minutes of a meeting in writing and keep records;

2/        maintain the documents and books of accounts of the cooperative society;

3/        prepare the annual work plan  and budget of the   cooperative society and implements same upon approval;

4/        call general assembly in accordance with the by-laws of the  cooperative society;

5/        execute decisions of the general assembly;

6/        manage all activities of the cooperative society, submit reports to the general assembly;

7/ distribute dividend Based on the approved audit reports by the general assembly of the coopperative society.

36.             Control Committee

1/        Any cooperative society shall have not less than three control committee members which is accountable to the general assembly and the number and manner of election of which shall be specified by the by-laws of the society.

 

2/        The term of office of members of the control committee shall be three years and no member of the control committee shall be elected for more than two consecutive terms and they may be dismissed by the general assembly at any time during their term of office.

 

 

3/        The election of members of control committee shall be conducted starting from the second election year by replacing at least one third of the members every year.

 

 

4/        Any member of control committee may be reelected after one fiscal year after he left office upon completion of their term.

 

37.             Powers and duties of the control committee

The Control Committee shall have the following powers and duties:

 

1/        follows up that the management committee is discharging its responsibilities properly;

 

2/        control that the fund and property of the cooperative society is properly utilized;

3/        follow up that the various activities of the cooperative society are carried out pursuant to law, by-laws and internal regulations of the cooperative society;

4/        execute decisions of the general assembly;

5/        performs other duties given to it by the general assembly.

38.             Other Sub-committees

Other sub-committees may be established pursuant to the by-laws of the cooperative society.

 

 

39.             Manager and Employee Professionals of the Cooperative Society

 

1/        Any cooperative society may employ a manager who is accountable to the management committee.

 

2/ any cooperative society shall record personal property of the manager and employed during recruitment on personal property registration form and make them to sign on it .The details shall be determined by council of ministers regulation.

 

 

3/        The manager shall administer and lead the day to day activities of the cooperative society; perform his activity in accordance with his job description and representation and as well as activities assigned to him by the management committee.

4/        Any cooperative society shall have professional workers accountable to the manager and perform day-to-day activities of the society.

 

5/        The appropriate authority shall issue a directive on particulars as to the recruitment and management of workers.

 

 

 

PART FIVE

Special privileges of cooperative society

 

40.             Priority of Claims by Cooperative Society

Notwithstanding any provision to the contrary in any law, debts owed to the cooperative society by member or employee of the cooperative society  or other bodies shall take precedence over all other debts, except the debt owed to the government.

41.             Set-off in Respect of Share or Benefit of Members

The shares or benefits of any member may be set-off for debts due to the cooperative society from such a member.

42.             Share or Benefit not Liable to Attachment or Sale

Except as provided in Article 41 hereof, the share or benefit of a member in a cooperative society shall not be liable to attachment or sale.

 

 

 

 

43.             Government assistance

1/        Without prejudice to incentives permitted under investment laws and other laws, any cooperative society which is organized and registered in accordance with this Proclamation shall be entitled to the following supports and incentives:

 

a)                 be exempted from income tax; provided, however, that the members shall pay income tax on their dividends from participation and on share according  to relevant income tax law;

 

 

b)                 to obtain land from the Region on the basis of allocation to conduct their activity or to provide their service;

 

c)         to receive promotion service with respect to cooperative movement and capacity building training from a national cooperative training institute;

 

d)        to receive other assistance from the Federal or Regional Government in accordance with the directives issued by appropriate authority.

2/        Any primary cooperative society shall be free from any court fees that is payable in connection with its property for dispute entertained by courts.

PART SIX

Asset and funds of cooperative societies

 

44.             Indivisibility of asset and funds of

a cooperative society

 

Except as otherwise prescribed under Article 45 and 59 of this Proclamation, the asset and fund of a cooperative society shall not be divided for the members or any other party.

 

45.              Allocation of net profit

1/               Any cooperative society shall deduct 30% of the net profit and allocate for the reserve fund.  The amount allocated for the reserve fund shall continue to be deducted until it reaches 30% of the capital of the cooperative society and it shall be deposited in the saving account of the society.

 

 

 

2/               The distribution of the remaining 70% net profit shall be determined by the general assembly; provided, however, that the general assembly may allocate for education or training or incentive or audit fund for social service from same net profit pursuant to the by-law of the cooperative society.

 

 

3/               The members of cooperative society who has received net profit pursuant to sub-article (2) of this Article may buy additional share.

 

 

46.             Establishment of Cooperative Societies Fund

 

1/ To enable the cooperative societies progressively so as to cover expenses related to audit activities or legal services or capacity building or for research and study or promotion and  communication or  other similar activities by their own capacities, they may establish a cooperative society fund.

 

 

 

 

2/        The establishment and source of finance for a Fund to be established pursuant to sub-article (1) of this Article shall be prescribed by regulations to be issued by the      Council of Ministers.

47.             Restriction on Borrowings

A cooperative society shall receive loans from its members or other organizations to such extent and on such conditions as may be specified in the by-laws of the cooperative society.

 

 

48.             Restriction on Loans

1/        A cooperative society shall not extend loan other than to its members or a cooperative society established under this Proclamation.

 

2/        Any cooperative society for the money lends, shall prescribe the interest rate in its by-laws based on the special resolution of the General Assembly.

3/        Particulars as to amount and conditions under which any cooperative society may extend loans pursuant to sub-article (1) of this Article shall be specified in the by-laws of the cooperative society.

4/        The amount of annual loan to be extended by any cooperative society shall be decided by the general assembly and be included in annual plan of the cooperative society.

 

49.             Types of Guarantee and Alternatives

Any cooperative society may decide and use in its by-laws the types and alternative guarantee it uses for the loans it extends.

 

 

 

Part seven

Cooperative society audit and inspection

50.             Audit

1/        The appropriate authority shall audit or causes to be audited by a person assigned by it, the accounts of any cooperative society at least once in a year in accordance to its fiscal year.

 

 

2/        The audit conducted pursuant to sub-article (1) of this Article shall include the examination and verification of overdue debts, if any, and cash balance, securities and assets and liabilities.

 

 

3/        The audit report shall be presented to the general assembly within 30 days starting from the date of its submission to the cooperative society.

 

 

4/        Any complaint and requested for re-examination of the audit report shall be presented within 30 days starting from the date of its approval by the general assembly.

5/        Any complaint and requested for re-examination of the audit report not presented within the period specified under sub-article (4) of this Article shall not be acceptable.

 

51.             Auditors’ Ethics

1/        Any audit report result produced by an auditor shall represent the right status of the cooperative society audited.

 

2/        Any auditor who produced an over or under statement audit report that does not represent the right financial status of a cooperative society; and intentionally causes damage on the cooperative society, elected leader, employees, third parties, creditors and others shall be liable in accordance with relevant law. 

 

52.             Inspection

1/        The appropriate authority may make an inspection of any cooperative society’s organizational status, operations, documents and financial conditions.

 

 

2/        The appropriate authority shall make an inspection of a cooperative society when the majority of the executive committee or one third of the total members or their representatives request.

 

3/        Any cooperative society shall let its operations be measured by setting acceptable standards in its area of operation.

 

 

 

4/        The appropriate authority shall issue directive on operational standards to measure the  status of a cooperative society.

 

 

 

 

 

 

 

 

 

53.             Keeping Audit and Inspection Results

Audit and inspection results conducted pursuant to article 50 and 52 of this Proclamation shall be kept in the office of the appropriate authority and the cooperative society in an easily accessible and visible manner to any person.

 

 

54.             Actions to be taken for losses of property and fund of the society

 

1/        The auditor or inspector shall make a report to the management committee or the general assembly or the appropriate authority, as the case may be, where the person who is or was entrusted with the management of the cooperative society or  members of management  committee or members of  board or  members of controle committee  or  other committee members  or who is or has been a manager or an employee of the society, who in the course of an audit or inspection has been found to have committed the following acts:

 

a)                 had made any payment not allowed by this Proclamation, the regulation or the by-laws or budget plan not approved by the  general assembly;

 

 

 

b)                 had made contract of purchase and payment out of the procurement  system and directive issued by the appropriate authority;

 

 

 

 

 

 

c)                  had intentionally or negligently caused any damages to the assets of the cooperative society by breach of trust; or

 

d)                 had misappropriated the properties of the cooperative society.

 

 

 

2/        The appropriate authority who received the report pursuant to sub-article (1) of this Article shall immediately call the person concerned and give an opportunity to present his defense with in two consecutive  working days, if any.

 

3/        With out the prejudice to the provisions of  sub-article (1) and (2) of this article  the appropriate authority shall ask the person who has been found responsible for misappropriation of the fund or property of the cooperative society to return or pay same with interest including compensation and damages; Where the person concerned is not willing to do so, the authority shall take the appropriate civil action by representing the cooperative societies.

 

 

 

 

PART Eight

Dissolution and winding up of

cooperative societies

 

55.             Dissolution of Cooperative Society

1/        A cooperative society shall be dissolved on one of the following grounds:

a)                 where a special resolution for its dissolution is given by the members of general assembly;

 

b)                 where the number of members of a primary cooperative society falls below what is specified under sub-article (2) and (3) of Article 7 of this Proclamation;

 

 

c)                  where the number of founder members of a cooperative societies union and federation falls below that which is predetermined in this Proclamation;

 

d)                 Where the court decides for its dissolution;

e)         where the audit report reveals that it is bankrupt and the appropriate authority ensures that such cause affects the viability of the cooperative society  and this  approved by the general assembly.

2/        The general assembly shall, within seven days from the date of decision, notify to the appropriate authority the dissolution of any cooperative society.

 

 

56.             Liquidator

1/        Where the dissolution of a cooperative society has been decided upon, pursuant to Article 55 of this Proclamation, the appropriate authority may assign a liquidator. It shall, if necessary, determine that his remuneration be paid out of the accounts of the cooperative society.

 

2/        The liquidator shall receive records, documents and properties of the society as soon as he is assigned. He shall also take the necessary measures to protect the properties and rights, records and documents of the cooperative society from damages.

 

 

57.             Powers and Duties of the Liquidator

1/        The liquidator shall have all the necessary powers to complete the winding up proceedings.  He shall in particular perform the following in order to carry out his duties properly:

 

 

a)                 investigate all claims against the cooperative society and decide on priority of payment among them;

 

b)                 collect the assets of the cooperative society;

c)         distribute the assets in accordance with the plan of liquidation approved by the general meeting of the cooperative society;

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

d)        carry on the work activities of the cooperative society in so far as may be necessary for the proper liquidation of the affairs of the cooperative society;

 

e)         represent the cooperative society in legal proceedings;

f)         call meetings of the members as may be necessary for the proper conduct of the liquidation.

 

2/        The liquidator shall issue notice in a newspaper having wider circulation, before the distribution of property of the cooperative society takes palace in accordance with paragraph (c) of sub-article (1) of this Article that the cooperative society is to be dissolved.  It shall proceed with the distribution, where no claim is presented within two months from the date of such notice.  No claimant shall have a right after the expiration of such limitation unless hindered by force major.

 

3/        Upon completion of the winding up proceedings the liquidator shall prepare and submit a report to the appropriate authority, he shall deposit the records and documents of the cooperative society in such places as the appropriate authority may direct.

 

58.             Calling on creditors

1/         Creditors shall be paid on the basis of a balance sheet prepared by the liquidator upon the commencement of his assignment.

 

 

 

2/         The liquidator shall inform the creditors the about dissolution of the cooperative society and require them to file their claims of money with supporting documents.

 

 

 

3/         Creditors appearing in the records of cooperative society or who are otherwise known shall be notified directly by registered postal letter.  Notice to other creditors shall be given by a newspaper having wider circulation published twice consecutively in a month.

 

 

 

59.             Protection of Creditors

1/        Until the creditors of the cooperative society have been paid or amounts required for payment be deposited, the liquidators may not distribute any part of assets among the members of the cooperative society.

2/        Where known creditors have failed to present their supporting documents, the amounts owing to them shall be deposited according to the decision of the court.

 

3/        Sums proportionate shall be set aside to meet the claims in respect of undertakings of the cooperative society which are not completed or which are under liquidation unless the creditors are guaranteed or distribution of assets is postponed until such undertakings are completed.

 

4/        After the payment of claims have been completed or verified by the appropriate authority that sufficient deposit for payment has been made, the liquidators may distribute the assets of the cooperative society among the members of the cooperative society based on the amount due to them.

 

60.             Cancellation of a society from the Register

When the winding up proceedings are completed the certificate of registration of the cooperative society shall be returned to the appropriate authority who shall cancel the registration of the cooperative society; and the cooperative society shall, upon the date of such cancellation, cease to exist.

PART NINE

Settlement of disputes

 

61.             Settling Disputes through Conciliation

1/        Deputes specified under Article 64 of this Proclamation may be settled through conciliators elected by disputant parties before they are submitted to arbitration.

 

2/        To resolve their issues through conciliation, each party shall elect one conciliator; the chairperson of the conciliators shall be elected by the agreement of the two parties.

3/        Where the two parties failed to reach agreement to elect the chairperson of the conciliation, the appropriate authority shall elect the chair person.

 

62.             Arbitration

1/        When the disputes provided under Article 64 of this Proclamation regarding cooperative societies are not settled by conciliation they shall be referred to arbitration.

 

 

2/        The arbitrators shall conduct their hearing and fulfill any of their duties in accordance with the Civil Procedure Code.

63.             Appointment of the Arbitrators

1/        The persons to be appointed for arbitration shall consist of three persons of high reputation and impartiality.

2/        Each party to the dispute shall appoint one arbitrator; The presiding arbitrator shall be appointed by the agreement of both parties.

3/        The appropriate authority shall appoint the presiding arbitrator when the parties fail to reach an agreement.

 

64.             Disputes to be Referred to Arbitration

 

The arbitrators shall have the power to hear and decide disputes not settled by conciliation regarding the organization, management or operations of a cooperative society in particular disputes involving the following:

 

1/        members or former members and members and members or representatives of former members or persons claiming in the name of deceased members;

 

 

 

 

2/        dispuses raised among the members or former members or members or representatives of former members or  heirs of deceased members and the members of the management committee,  any manager or representative of the management committee or  employee of the cooperative society;

3/        the cooperative society or the management committee and any former management committee, any manager, agent or employee, or any former manager, agent or employee or the nominee heirs or representatives or representatives or deceased former manager or employees; or

 

4/        disputes arising between cooperative societies.

65.             Civil Court Powers of Arbitrators

The Arbitrators shall have the same power, with regard to the cases provided under Article 64 of this Proclamation, as a Civil Court for the summoning of witnesses, production of evidence, the issuing of orders or for the taking of any other legal measures.

 

 

66.  Execution

Any decision, order or award made under this Proclamation shall be considered as it is made by a regular Civil Court, and, where appropriate, the courts shall have jurisdiction to order the enforcement of any such decision, order or award.

 

 

 

 

 

67.  Power of Courts

1/ Any person who has grievance on the decisions given by the Arbitrators pursuant to Article 65  of this Proclamation may lodge appeal to the Regular  Courts if the issue is at Regional level  to Regional Court whish have jurisdictiom, if it is at Federal level  to the Federal High Court.

 

 

 

2/ With out prejudice to the provisions of article 61 and 62 of this proclamation, parties do not agree on concillation or arbitration the issue to regular court which have jurisdicetion.

 

PART TEN

Miscellaneous Provisions

68.  period of limitation

Any right emanated from a countract concluded by the cooperative society involving it’s properties shall be bared by statue of limitation after ten years.

69.  Address of a cooperative society

1/        Any cooperative society shall have an address registered pursuant to Article 10 of this Proclamation; and all summons, notices and other communications shall be sent via such address. 

2/        The cooperative society shall, within 30 days, inform the appropriate authority of any change in such address.

 

70. Power and Duties of the Appropriate Auhority

      Without prejudice to the powers and duties vested in by the provisions of other laws  the Appropriate Auhority without  interfering in the affairs of the cooperative societies, shall have the following powers and duties:

 

1/        organize, register, strengthen and cancel cooperative societies;

2/        provide uniform accounting system of  cooperative society and strengthening same ;

 

3/        conduct study and research on cooperative societies;

4/        inspect, audits and give legal service to cooperative societies;

 

5/        assess and certify competence status of cooperative societies and accredit their level;

 

 

6/        build the capacity of cooperative society and their professionals;

 

7/        provide professional product marketing assistance to cooperative societies;

8/        develop working system that guides cooperative societies.

71. Establishment of Cooperative Societies Advisory Council

1/        The cooperative advisory council (herein after the Council) which is accountable to the Ministry of Agriculture and Natural Resource is hereby established.

2/        The members of the Council shall be persons representing the interest of the cooperative society in the country.

 

3/        The chairperson of the Council shall be assigned by the Ministry of Agriculture and Natural Resource.

4/        The manner of election and the number of members of the Council shall be determined by the Federal Cooperative Societies Agency.

5/        Members of the Council appointed pursuant to sub-article (4) of this Article shall be appropriate experts having the knowledge of cooperative society and dedicated to produce guiding idea, and shall be from:

 

a)                 cooperative societies movement, universities that offer  cooperative programs, and cooperative training centers;

 

b)                 cooperative societies professionals association;

 

 

 

c)                  Government and non government organizations supporting cooperative societies’ movement and prominent individuals.

6/        The term of office of members of the Council shall be determined by Federal Cooperative Agency and it shall not exceed 3 years; provided, however a member completed his term may be re-elected for additional second term.

7/        Any member of the Council may resign in writing.

8/        There shall be no remuneration for the service of the members of the Council; provided, however, that the expenses incurred by them in carrying out their duties shall be remunerated by the decision of the Federal Cooperative Agency.

 

 

 

9/        A member of Council may, without any notice, be removed from membership for:

 

a)         serious misconduct;

b)        permanent incapacity;

c)         engaging in any activity that may undermine the integrity of the Council.

10/      The time, place and procedures of meeting of the Council shall be determined in the directive issued by the Council and be implemented upon approval by the Federal Cooperative Agency.

11/      The duties and responsibilities of the members of the Council shall be determined by directive issued by Federal Cooperative Agency.

 

 

72.  Accessibility of Laws, Regulations, Directives and By-laws

Any cooperative society shall deposit in its address and make accessible the Proclamation, Regulations, Directives and the by-laws related to the cooperative societies.

 

 

73.    Obligation to Cooperate

Any concerned organ shall have obligation to cooperate for the implementation of this Proclamation.

74.             Repealed and Inapplicable laws

1/ The Cooperative Societies Proclamation No. 147/1998 (as amended by Proclamation No. 402/2004) is hereby repealed.

2/        No law, regulation or directives in so far as it is inconsistent with this Proclamation, be applicable in respect of matters provided for by this Proclamation.

75.             Transitory Provisions

1/        The cooperative societies which have been operating, but not registered in accordance with Proclamation No. 147/1998 (as amended by Proclamation No. 402/2004) or appropriate Regional law shall reorganize itself and get register pursuant to this Proclamation within two years from the effective date of this Proclamation. The cooperative society not registered within the prescribed time it may lose it`s right and juridical personalities.

 

 

2/        The cooperative societies which have been established and operating in accordance with Proclamation No. 147/1998 (as amended by Proclamation No. 402/2004) or appropriate Regional law shall be deemed to have been established under this Proclamation and shall continue to carry out their functions in accordance with this Proclamation.

 

 

 

 

3/        Notwithstanding Article 74 of this Proclamation, any pending issues before the effective date of this Proclamation shall be finalized in accordance with Proclamation No. 147/1998 (as amended by Proclamation No. 402/2004) or if the issue is at Regional level with appropriate Regional Proclamation.

76.             Issuance of implementing legislations

1/        The Council of Ministers may issue regulation necessary for the implementation of this Proclamation.

 

2/ Regions may issue law in a manner which is  not contrary to this proclamation and regulation issued here under. 

 

3/        The Federal Cooperative Agency may issue directives for the implementation of this Proclamation and regulation issued pursuant to sub-article (1) of this Article.

 

 

 

77.             Effective Date

This Proclamation shall enter into force on the date of its publication in the Federal Negarit Gazette.

 

         Done at Addis Ababa, this 23^rd day of December 2016.

 

       MULATU TESHOME (Dr.)

 

       PRESIDENT OF THE FEDERAL DEMOCRATIC

REPUBLIC OF ETHIOPIA