Capital
Open ↗66. The capital of a society may be raised by all or any of the following means:(a)
entrance fees which are not refundable except in cases where an application for membership has been rejected;
(b)
ordinary shares subscribed and paid up by members;
(c)
permanent shares subscribed and paid up by institutional members;
(d)
in the case of credit societies —(i)
subscription capital; and
(ii)
other deposits from members which are withdrawable subject to conditions laid down in the by‑laws;
(da)
bonds or debentures issued by the society subject to such restrictions as are laid down in this Act and in the by-laws;[Act 17 of 2024 wef 18/07/2024]
(e)
deposits or loans from non-members subject to such restrictions as are laid down in this Act and in the by‑laws;
(f)
donations made by third persons except that no donations from any foreign source, whether offered directly or otherwise, may be received by a society without the Registrar’s prior approval.[Act 17 of 2024 wef 18/07/2024]
Ordinary shares
Open ↗66A.—(1) A society may issue ordinary shares.[3/2018]
(2) A member of a society must hold the minimum number of ordinary shares of the society specified in the by‑laws of the society.[3/2018]
(3) The member may withdraw or transfer the ordinary shares which the member is required to hold under subsection (2) only when the member ceases to be a member of the society.[3/2018]
(4) Where a member of a society holds ordinary shares of the society in excess of the minimum number the member is required to hold under subsection (2), the member may withdraw or transfer the excess shares in accordance with this Act and the by‑laws of the society.[3/2018]
Permanent shares
Open ↗66B.—(1) A society may issue permanent shares only to an institutional member.[3/2018]
(2) An institutional member of a society must obtain the Registrar’s written approval to be entitled to subscribe, in accordance with the by‑laws of the society, for permanent shares issued by the society, if the institutional member is a credit society.[3/2018]
(3) A permanent share issued by a society to an institutional member of the society —(a)
cannot be withdrawn by that institutional member, and cannot be converted to an ordinary share; but
(b)
may, with the approval of the committee of management of the society and in accordance with this Act and the by‑laws of the society, be transferred by that institutional member to another institutional member of the society.[3/2018]
(4) A society —(a)
may, with the Registrar’s written approval, buy back a permanent share issued by the society under this section; but
(b)
cannot be required to buy back that share.[3/2018]
(5) A society that buys back a permanent share issued by the society under this section may —(a)
hold that share;
(b)
with the approval of the committee of management of the society and in accordance with this Act and the by‑laws of the society, transfer that share to an institutional member of the society; or
(c)
cancel that share.[3/2018]
Restrictions on loans
Open ↗67.—(1) Subject to subsection (2), a credit society must not make a loan or allow any credit to any person other than —(a)
a member of the credit society or the member’s immediate family member;
(b)
an employee of the credit society; or
(c)
another society that is not a member of the credit society, with the Registrar’s written approval.
(2) For the purposes of subsection (1), a credit society may make loans or allow credit to persons who are not members of the credit society only to such extent and under such conditions as may be prescribed by its by-laws.
(3) In this section, “immediate family member” has such meaning as may be prescribed.
Restrictions on borrowing
Open ↗68.—(1) A society may receive loans from persons who are not members of the society only to such extent and under such conditions as may be prescribed by its by-laws and in the Rules.
(2) A credit society must not receive any deposit from any person other than a member of the credit society, or the member’s immediate family member to such extent and under such conditions as may be prescribed by its by-laws.
(3) A society which, under its by-laws, has power to borrow money is to determine from time to time at a general meeting —(a)
the maximum liability which it may incur in loans from non-members; and
(b)
where the society is a credit society, the maximum liability which it may incur in loans or deposits from its members and their immediate family members.
(4) Where the society is a credit society —(a)
the maximum liability determined under subsection (3)(a) is subject to the Registrar’s approval; and
(b)
the Registrar may, at any time, reduce either or both of the maximum liabilities determined under subsection (3)(a) and (b) or impose such conditions (for either or both of those maximum liabilities) as the Registrar thinks necessary.[3/2018]
(5) The Registrar must, before reducing either or both of the maximum liabilities determined under subsection (3)(a) and (b) or imposing any condition, give the credit society concerned —(a)
notice in writing of the Registrar’s intention to do so; and
(b)
an opportunity to make written representations, within the time specified in the notice (being at least 14 days after the date of service of the notice), as to why the Registrar should not reduce the maximum liabilities or impose the condition, as the case may be.[3/2018]
(6) The Registrar must issue the credit society a written notice of the Registrar’s decision whether to reduce either or both of the maximum liabilities determined under subsection (3)(a) and (b) or to impose any condition.[3/2018]
(7) Where the Registrar decides to reduce either or both of the maximum liabilities determined under subsection (3)(a) and (b) or to impose any condition, the written notice in subsection (6) must specify a date at least 14 days after the date of the notice upon which the Registrar’s decision or condition is to take effect.[3/2018]
(8) A credit society which is aggrieved by the Registrar’s decision under subsection (6) may, within 14 days after the date of the decision or such longer period as the Minister may allow in any particular case, appeal in writing to the Minister, whose decision is final.[3/2018]
(9) If the credit society appeals to the Minister under subsection (8), the decision appealed against does not take effect unless the decision is confirmed by the Minister, or the appeal is withdrawn or is for any reason dismissed by the Minister.[3/2018]
(10) In this section, unless the context otherwise requires —“immediate family member” has such meaning as may be prescribed;
“loan”, in relation to a society, means —(a)
the granting of an advance and other facility by a person to the society whereby the society has access to funds or financial guarantees; or
(b)
the incurring by the person of other liabilities on behalf of the society.
Investment of funds
Open ↗69.—(1) A society may invest or deposit its funds in such manner as it thinks fit.
(2) Despite subsection (1), a credit society must invest or deposit its funds in accordance with any restrictions on investment contained in written directions issued by the Registrar.[3/2018]
(3) Despite section 63, any person who exercises any power of investment in relation to the funds of a society pursuant to subsection (1) or (2) is, when exercising such power of investment, subject to the same duty of care imposed on a trustee under section 3A of the Trustees Act 1967.[3/2018]
Contributions to Central Co-operative Fund and Singapore Labour Foundation
Open ↗71.—(1) A fund called the Central Co‑operative Fund is established, which is to be used to further co‑operative education, training, research, audit and for the general development of the co-operative movement in Singapore.
(2) Every society must contribute —(a)
5% (or such other rate as may be prescribed in substitution) of the first $500,000 of the surplus resulting from the operations of the society during the preceding financial year (excluding any amount specified in subsection (2A) and any grant from the Government excluded under subsection (2B)) to the Central Co-operative Fund; and[Act 17 of 2024 wef 18/07/2024]
(b)
20% (or such other rate as may be prescribed in substitution) of any surplus in excess of $500,000 from the operations of the society during the preceding financial year (excluding any amount specified in subsection (2A) and any grant from the Government excluded under subsection (2B)) either to the Central Co-operative Fund or to the Singapore Labour Foundation as the society may opt.[3/2018]
[Act 17 of 2024 wef 18/07/2024]
(2A) In subsection (2), any gains or profits arising from the disposal of any of the following are excluded from the surplus of a society:(a)
immovable property owned by the society and used by the society for its own operations;
(b)
shares (whether listed or unlisted) in any entity held by the society.[Act 17 of 2024 wef 18/07/2024]
(2B) In subsection (2), the Minister may, by order in the Gazette and subject to any conditions specified in the order, exclude any grant from the Government from the surplus of a society.[Act 17 of 2024 wef 18/07/2024]
(3) A society is deemed to have opted to contribute to the Central Co‑operative Fund under subsection (2)(b) if that society does not exercise its option within such time and in such manner as the Registrar may require.
(4) A society may from time to time change its option in respect of its contribution under subsection (2)(b) by notifying the Registrar in such manner as the Registrar may require and the change in option applies to the contribution of the society for the financial year in which falls the second anniversary of the date on which the Registrar was notified under this subsection and to all contributions of the society thereafter until the society again changes its option.
(5) The Central Co-operative Fund must be administered as a trust fund in such manner as the Minister may prescribe in the Rules.
(6) The Minister may, by order in the Gazette and subject to such conditions as the Minister may specify in the order, remit or refund, wholly or in part, any contribution mentioned in subsection (2)(a) or (b) paid or payable by a particular society or a particular class of societies.[3/2018]
Distribution of net surplus
Open ↗72.—(1) The net surplus may be divided among the members by way of dividend or patronage refund or by way of honoraria to officers of the society, or allocated to any other funds constituted by the society to such extent and under such conditions as may be prescribed under this Act or in the by-laws.
(2) A society must not pay a dividend (or total dividend under this section and section 72A) on paid‑up share capital or subscription capital exceeding —(a)
in any case where that society is a credit society that does not meet any prudential requirement contained in written directions issued by the Registrar — a maximum rate specified in written directions issued by the Registrar to that society; or
(b)
in any other case — a maximum rate prescribed in the Rules.[3/2018]
[Act 17 of 2024 wef 18/07/2024]
Allocation, distribution and payment of reserves
Open ↗72A.—(1) Subject to this Act, any conditions prescribed in the by-laws and any written direction by the Registrar, a society may allocate its reserves (or any part of the reserves) to funds constituted by the society, and may change the amount of the reserves allocated to any fund from time to time.
(2) Subject to subsection (3), the reserves (or any part of the reserves) may be distributed to the members by way of dividend or paid to officers of the society by way of honoraria, to such extent and under such conditions as may be prescribed under this Act or in the by-laws.
(3) A committee of management proposing to make a distribution or payment under subsection (2) must obtain the Registrar’s approval for the distribution or payment before the annual general meeting of the society is held to consider and resolve the making of the distribution or payment.[Act 17 of 2024 wef 18/07/2024]
Bonus certificates and bonus shares
Open ↗73.—(1) A society may distribute a part of its net surplus among its members in the form of bonus certificates or bonus shares.
(2) A society may distribute in the form of a bonus certificate only a part of its net surplus payable under ordinary shares.[3/2018]
(3) In the case of bonus certificates, the members holding the certificates are only entitled to claim payment out of the society’s funds 5 years after the date when the bonus certificates were issued.[3/2018]
(4) No interest or dividend may be paid on the bonus certificates.[3/2018]
(5) Where a society distributes a part of its net surplus payable under ordinary shares in the form of a bonus share —(a)
the bonus share is to take the form of an ordinary share; but
(b)
a member is entitled to withdraw or transfer a bonus share only 10 years after the date when the bonus share was issued.[3/2018]
(6) Where a society distributes a part of its net surplus payable under permanent shares in the form of a bonus share issued to an institutional member —(a)
the bonus share is to take the form of a permanent share; and
(b)
the bonus share —(i)
cannot be withdrawn by that institutional member, and cannot be converted to an ordinary share; but
(ii)
may, with the approval of the committee of management of the society and in accordance with this Act and the by‑laws of the society, be transferred by that institutional member to another institutional member of the society.[3/2018]
(7) Despite subsections (3) and (5), a member of a society who is a foreign worker is eligible to receive from the society the value of the member’s bonus certificate or bonus share if —(a)
the member ceases employment in Singapore for any reason, including the completion of the member’s contract of service; and
(b)
the committee of management of the society is satisfied that the member —(i)
has left or will soon leave Singapore permanently; and
(ii)
has no intention to resume employment in Singapore.[3/2018]
[Act 17 of 2024 wef 18/07/2024]
(7A) Despite subsections (3) and (5), a person who is authorised to administer the property of a member is eligible to receive from the society the value of the member’s bonus certificate or bonus share if the member is —(a)
dead;
(b)
bankrupt;
(c)
a society for which a winding up order has been made under section 83(1) or (2); or
(d)
a trade union that has been dissolved under section 19 of the Trade Unions Act 1940.[Act 17 of 2024 wef 18/07/2024]
(8) In this section —“foreign worker” means an individual who is employed in Singapore but is neither a citizen nor a permanent resident of Singapore;
“member” includes a person who has resigned as a member.[3/2018]
Source: Singapore Statutes Online (Attorney-General's Chambers), © Government of Singapore.
