The Co-operative and Community Benefit Societies and Credit Unions (Arrangements, Reconstructions and Administration) Order 2014

PART 4 U.K. Modified application of Schedule 1 to the Insolvency Act 1986 to relevant societies (further modifications)

35.  Schedule 1 to the 1986 Act M1 applies in relation to a relevant society with the further modifications set out in this Part and with any other necessary modification. U.K.

Marginal Citations

M1 Paragraph 2 of Schedule 1 was amended by the Abolition of Feudal Tenure etc. (Scotland) Act 2000 (asp 5), section 76(2) and Schedule 13, Part 1.

36.  This Part has effect without limiting paragraph 26 of this Schedule. U.K.

37.  In this Part— U.K.

(a) a reference to a numbered paragraph is a reference to the paragraph so numbered in Schedule 1 to the 1986 Act;

(b) “the 1979 Act” means the Credit Unions Act 1979 M2 ; and

(c) “credit union” has the meaning given in section 31(1) of the 1979 Act.

Marginal Citations

M2 1979 c. 34.

38.  Paragraph 3 (power to borrow) has effect as if it provided that power to raise or borrow money and grant security over the property of the society— U.K.

(a) in the case of a credit union, is subject to—

(i) the provisions of [F1 Chapters 1 and 2 of Part 5 of the 2014 Act (charges over a society’s assets)];

(ii) section 7 (shares) M3 , section 7A (power to issue interest-bearing shares) M4 and section 8 (general prohibition on deposit-taking) M5 of the 1979 Act; and

(iii) the rules of the society containing provision in respect of the matters mentioned in paragraph 7 of Schedule 1 to the 1979 Act (determination of the maximum amount of the interest in the shares of the society which may be held by any member);

(b) in the case of a relevant society which is not a credit union, is subject to—

[F2 (i) section 24 (maximum interest in a society’s withdrawable shares) and section 67 (registered society with withdrawable share capital not to carry on banking etc) of the 2014 Act;

(ii) paragraphs 6 to 8 of Schedule 3 to the 2014 Act (provision about maximum shareholding and maximum deposits for certain societies registered or treated as registered before 1st August 2014);

(iii) the provisions of Chapters 1 and 2 of Part 5 of the 2014 Act (charges over a society’s assets); and

(iv) the rules of the society which make provision in accordance with section 14 of the 2014 Act (content of a society’s rules) about maximum shareholding and borrowing powers;]

(c) in either such case, is subject to such other enactments and such rules of the society as govern or restrict the exercise of that power.

Textual Amendments

F1 Words in Sch. 1 para. 38(a)(i) substituted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions (Arrangements, Reconstructions and Administration) (Amendment) Order 2014 (S.I. 2014/1822), arts. 1(2), 5(l)(i)

F2 Sch. 1 para. 38(b)(i)-(iv) substituted for Sch. 1 para. 38(b)(i)-(iii) (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions (Arrangements, Reconstructions and Administration) (Amendment) Order 2014 (S.I. 2014/1822), arts. 1(2), 5(l)(ii)

Marginal Citations

M3 Section 7 was amended by S.I. 2011/2687.

M4 Section 7A was inserted by S.I. 2011/2687.

M5 Section 8 was amended by S.I. 2002/1501.

39.  Paragraphs 15 (power to establish subsidiaries) and 16 (power to transfer property to subsidiaries) do not apply in relation to credit unions. U.K.

40.  Paragraph 16 has effect in relation to a relevant society other than a credit union as if— U.K.

(a) the reference to subsidiaries were a reference to subsidiaries within the meaning given in [F3 section 100 (meaning of company being a “subsidiary” of a society) or section 101 (meaning of society being a “subsidiary” of another society) of the 2014 Act]; and

(b) it provided that power to transfer to subsidiaries of the society the whole or any part of the business or property of the society is only exercisable in accordance with a special resolution under [F4 section 110 (transfer of engagements between societies) or section 112 (conversion of society into a company, amalgamation with a company etc) of the 2014 Act].

Textual Amendments

F3 Words in Sch. 1 para. 40(a) substituted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions (Arrangements, Reconstructions and Administration) (Amendment) Order 2014 (S.I. 2014/1822), arts. 1(2), 5(m)(i)

F4 Words in Sch. 1 para. 40(b) substituted (1.8.2014) by The Co-operative and Community Benefit Societies and Credit Unions (Arrangements, Reconstructions and Administration) (Amendment) Order 2014 (S.I. 2014/1822), arts. 1(2), 5(m)(ii)