merrion street

The Minister for Jobs, Enterprise and Innovation, Richard Bruton, T.D.,

today announced the commencement of new legislation to ease the

regulatory burden on co-operative societies and make it easier to start up

and run a co-op as an alternative form of enterprise organisation.

This follows the introduction, in December 2012, of reductions of 33-80% in

the fees for business transacted with the Register of Friendly Societies,

who registers co-operative societies. These moves form part of the delivery

of the Programme for Government commitment to promote co-ops as a form of

enterprise.

This legislation will ease the regulatory burden on co-operative societies

and make it easier to run a co-operative as an alternative form of

enterprise organisation. Because of their importance the Government has

committed to assisting this particular form of enterprise to expand,

develop and to continue to have a positive impact on business in this

country. In particular the legislation will:

Ø Allow individual societies to set their own limit on individual

shareholdings in the society

Ø Ease financial reporting restrictions by extending the period for the

preparation and submission of the annual return and accounts

Ø Make it easier for cancelled societies to be restored to the register

Ø Ease fund-raising restrictions for non-agricultural societies

In addition, the legislation will make the Examinership process, currently

available only to companies, an option for co-operative societies which

might find themselves in difficulties (these provisions will be commenced

once the Rules of Court are amended).

Finally, the Act also makes changes to the legislation governing friendly

societies. There are currently just 47 friendly societies (mostly

charitable or benevolent societies) registered with the Registrar of

Friendly Societies, and many of these have relatively low levels of

activity. There have been just three new entrants to this group in the

last 9 years, and it is clear that this nineteenth-century model has

out-lived its usefulness and is ill-suited to meeting the needs of the

twenty-first century.

Making the announcement, Minister Bruton said:

“If we are to sustain the progress we have made in the economy and create

jobs we will have to continue working hard to reduce business costs and red

tape. A crucial part of this will be to reduce those costs and red tape

which are directly under the control of government.

“As we recognised in the Programme for Government, forms of enterprise

organisation other than the company can play a role in meeting needs in

different sectors, and I am determined to ensure the legislation governing

these models supports business development and that the burden of red tape

is kept to a minimum.

“The Government recognises that co-operatives play a very significant role

in our economic and social development, whether it is through the livestock

marts that operate in nearly every county, group water schemes or housing

co-operatives which provide affordable housing to people with modest

incomes. Co-operatives are rooted in the community and offer jobs to local

people.

“This legislation addresses particular problems which have been identified

in the co-operative sector, and will help ensure that this model can thrive

and grow to its potential”.

The Minister added that the Charities Regulatory Authority, established

earlier this year, would provide an appropriate regulatory environment for

charitable and benevolent groups and societies, ensuring that there is a

suitable framework in place for the proper regulation of such groups into

the future.