Credit Unions Act 1979

General and miscellaneous U.K.

[F1 23A Power to make provision corresponding to provision applying to building societies U.K.

(1) The Treasury may by regulations amend this Act so as to make provision for credit unions corresponding to any enactment applying to building societies.

(2) The power conferred by subsection (1) may not be exercised so as to modify any of the following provisions of this Act—

(a) sections 1 and 2 (registration as a credit union);

(b) section 3 (use of name “credit union”);

(c) section 8 (general prohibition on deposit-taking), but without prejudice to the power to add exceptions to those in sections 9 and 10 and to modify those sections;

(d) section 21 (amalgamations and transfers of engagements);

(e) section 22 (no conversion of credit union into company, etc. );

(f) section 23 (conversion of company into credit union).

(3) Regulations under subsection (1) may—

(a) confer power to make orders, regulations and other subordinate legislation;

(b) create criminal offences, but only—

(i) in circumstances corresponding to an offence under the enactments relating to building societies, and

(ii) subject to a maximum penalty no greater than is provided for in respect of the corresponding offence;

(c) provide for the charging of fees, but not any charge in the nature of taxation.

(4) The Treasury may by regulations make such amendments of enactments as appear to them to be appropriate in consequence of any provision made under subsection (1).

This includes power to make consequential amendments of the provisions listed in subsection (2).

(5) In this section “ enactment ” includes—

(a) an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978 (c. 30),

(b) an enactment contained in, or in an instrument made under, an Act of the Scottish Parliament,

(c) an enactment contained in, or in an instrument made under, Northern Ireland legislation within the meaning of the Interpretation Act 1978, and

(d) an enactment contained in, or in an instrument made under, a Measure or Act of the National Assembly for Wales.

(6) Before making regulations under this section the Treasury must consult such persons as appear to them to be appropriate.

(7) No regulations under this section are to be made unless a draft has been laid before and approved by a resolution of each House of Parliament.]

Textual Amendments

F1 S. 23A inserted (1.12.2013) by Co-operative and Community Benefit Societies and Credit Unions Act 2010 (c. 7), ss. 5(1), 8(2) (with s. 4(6)); S.I. 2013/2936, art. 2

F2 24 Modifications of requirements as to audit of accounts. U.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F2 S. 24 omitted (8.1.2012) by virtue of The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 10(3) (with arts. 25, 26)

25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F3 U.K.

Textual Amendments

F3 S. 25 repealed by Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 844(4), Sch. 31

26 Prohibition on subsidiaries. E+W+S

A credit union shall not have any subsidiary within the meaning of [F4 Part 7 of the 2014 Act ].

Textual Amendments

F4 Words in s. 26 substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 14 (with Sch. 5)

F5 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E+W+S

Textual Amendments

F5 S. 27 omitted (2.7.2002) by virtue of S.I. 2002/1501, arts. 1(1), 2(19)

28 Provisions as to offences. E+W+S

[F6 (1) In Part 10 of the 2014 Act (offences) as it applies to credit unions, references to that Act include this Act.]

F7 (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Without prejudice to the operation of subsection (1) above in relation to offences under [F8 the 2014 Act ] committed by or in relation to a credit union, [F9 section 132(4) of that Act ] (extension of time limit for summary prosecutions in certain cases) shall not apply to proceedings for an offence under this Act.

(4) Where under [F10 section 128 of the 2014 Act ] (offences by registered societies to be also offences by officers, etc.) as it applies by virtue of subsection (1) above an individual is convicted on indictment of an offence under this Act, he shall be liable not only to a fine but, in the alternative or in addition, to imprisonment for a term not exceeding two years.

(5) Where an offence under this Act which has been committed by a body corporate other than a registered society is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of, any director, manager, secretary or similar officer of the body corporate, or any person who was purporting to act in any such capacity, he as well as the body corporate shall be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

(6) In any proceedings for an offence under this Act it shall be a defence for the person charged to prove that he took all reasonable precautions and exercised all due diligence to avoid the commission of such an offence by himself or any person under his control.

Textual Amendments

F6 S. 28(1) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 15(2) (with Sch. 5)

F7 S. 28(2) repealed (2.7.2002) by 2000 c. 8, ss. 338(4), 432(3), Sch. 18 Pt. V para. 25, Sch. 22; S.I. 2001/3538, art. 2(5)

F8 Words in s. 28(3) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 15(3)(a) (with Sch. 5)

F9 Words in s. 28(3) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 15(3)(b) (with Sch. 5)

F10 Words in s. 28(4) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 15(4) (with Sch. 5)

[F11 29 Orders and regulations. E+W+S

(1) Any power to make an order or regulations conferred on the Treasury by any provision of this Act shall be exercisable by statutory instrument.

(2) [F12 Except as provided by section 23A(7), ] [F13 and] [F14 subject to subsection (3),] A statutory instrument made under this Act shall be subject to annulment in pursuance of a resolution of either House of Parliament.]

[F15 (3) A statutory instrument containing an order under section 5A or section 11(1A) of this Act may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.]

Textual Amendments

F11 S. 29 substituted (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1), Sch. 3 Pt. IV para. 287 (with art. 13(3)); S.I. 2001/3538, art. 2(1)

F12 Words in s. 29(2) inserted (1.12.2013) by Co-operative and Community Benefit Societies and Credit Unions Act 2010 (c. 7), ss. 5(2), 8(2) (with s. 4(6)); S.I. 2013/2936, art. 2

F13 Word in s. 29(2) inserted (1.12.2013 being the date that 2010 c. 7, s. 5(2) comes into force, see S.I. 2013/2936 art. 2) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(a), 15(4)(a) (with arts. 25, 26)

F14 Words in s. 29(2) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 15(4)(b) (with arts. 25, 26)

F15 S. 29(3) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 15(4)(c) (with arts. 25, 26)

F16 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E+W+S

Textual Amendments

F16 S. 30 repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1)(2), Sch. 3 Pt. IV para. 288, Sch. 4 (with art. 13(3)); S.I. 2001/3538, art. 2(1)

31 Interpretation, etc. E+W+S

(1) In this Act—

• [F17 “ the 2014 Act ” means the Co-operative and Community Benefit Societies Act 2014; ]

• F18 . . .

• [F19 “body corporate” includes a partnership regarded as a legal person under the law of the country or territory in which it was established;]

• “charitable", in the application of this Act to Scotland, shall be construed in the same way as in the Income Tax Acts;

• [F20 “ civil partner ” includes former civil partner [F21 and reputed civil partner ] ; ]

• [F22 “corporate member”, in relation to a credit union, has the meaning assigned to it by section 5A above;]

• “credit union”, except in the expression “Northern Ireland credit union", means a society registered under [F23 the 2014 Act ] by virtue of section 1 above;

• [F24 “interest-bearing share” has the meaning assigned to it by section 7A(6) above;]

• “the 1965 Act” means the Industrial and Provident Societies Act 1965;

• “non-qualifying member”, in relation to a credit union, has the meaning assigned to it by sections 5(5) and 21(4) above;

• F25 ...

• [F26 “partnership” means a partnership not regarded as a legal person under the law of the country or territory in which it was established;]

• “relative”, in relation to any person, means any of the following—

  (a)

  his spouse [F27 or civil partner ];

  (b)

  any lineal ancestor, lineal descendant, brother, sister, aunt, uncle, nephew, niece or first cousin of his or his spouse [F27 or civil partner ]; and

  (c)

  the spouse [F27 or civil partner ] of any relative within paragraph (b) above;

  and for the purpose of deducing any such relationship an illegitimate child or step-child shall be treated as [F28 the legitimate child of the relationship in question ];

• “spouse” includes former spouse and reputed spouse; and

• F29 . . .

[F30 (1A) In this Act, references to a deposit or accepting deposits must be read with—

(a) section 22 of the 2000 Act;

(b) any relevant order under that section; and

(c) Schedule 2 to that Act.]

(2) [F31 Sections 141, 143 to 146, 148 and 149 of the 2014 Act ] (supplementary provisions as to recovery of costs, fees, regulations, documents F32 . . . and general interpretation provisions) shall apply for the purposes of this Act as they apply for the purposes of that Act.

(3) In its application to credit unions [F33 the 2014 Act ] shall have effect subject to the provisions of this Act and with the omission of the following provisions (which are replaced by, or are inconsistent with, provisions of this Act), that is to say [F34 sections 22, 24, 26, 27, 32, 33 and 34 and paragraph 6 of Schedule 3. ]

[F35 (4) [F36 The following provisions of the 2014 Act ] (which are replaced by, or are inconsistent with, provisions of the 2000 Act) do not apply to credit unions] [F37 —

(a) section 67(1) (society with withdrawable share capital not to carry on the business of banking);

(b) sections 77 and 78 (year of account);

(c) section 81 (duty to display latest balance sheet);

(d) section 89 (annual returns);

(e) section 90 (duty to provide copy of annual return).]

Textual Amendments

F17 Words in s. 31(1) inserted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(2)(a) (with Sch. 5)

F18 Definition of “authorised bank” in s. 31(1) omitted (2.7.2002) by virtue of S.I. 2002/1501, arts. 1(1), 2(20)(a)(i)

F19 Words in s. 31(1) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 15(5)(a) (with arts. 25, 26)

F20 Words in s. 31(1) inserted (5.12.2005) by Civil Partnership Act 2004 (c. 33), s. 263(10)(b), Sch. 27 para. 61(2); S.I. 2005/3175, art. 2(2)

F21 Words in s. 31(1) inserted (5.12.2005) by Civil Partnership Act 2004 (Overseas Relationships and Consequential, etc. Amendments) Order 2005 (S.I. 2005/3129), art. 1, Sch. 4 para. 4

F22 Words in s. 31(1) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 15(5)(b) (with arts. 25, 26)

F23 Words in s. 31(1) inserted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(2)(b) (with Sch. 5)

F24 Words in s. 31(1) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 19(2) (with arts. 25, 26)

F25 Words in s. 31(1) omitted (1.4.2013) by virtue of The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), art. 1(1), Sch. 6 para. 16 (with Sch. 12)

F26 Words in s. 31(1) inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 15(5)(c) (with arts. 25, 26)

F27 Words in s. 31(1) inserted (5.12.2005) by Civil Partnership Act 2004 (c. 33), s. 263(10)(b), Sch. 27 para. 61(3)(a); S.I. 2005/3175, art. 2(2)

F28 Words in s. 31(1) substituted (5.12.2005) by Civil Partnership Act 2004 (c. 33), s. 263(10)(b), Sch. 27 para. 61(3)(b); S.I. 2005/3175, art. 2(2)

F29 Definition of “statutory maximum” in s. 31(1) repealed (5.11.1993) by 1993 c. 50, s. 1(1), Sch. 1 Pt. XIV.

F30 S. 31(1A) substituted (2.7.2002) by S.I. 2002/1501, arts. 1(1), 2(20)(b)

F31 Words in s. 31(2) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(3) (with Sch. 5)

F32 Words in s. 31(2) repealed (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1)(2), Sch. 3 Pt. IV para. 289(b), Sch. 4 (with art. 13(3)); S.I. 2001/3538, art. 2(1)

F33 Words in s. 31(3) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(4)(a) (with Sch. 5)

F34 Words in s. 31(3) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(4)(b) (with Sch. 5)

F35 S. 31(4) inserted (2.7.2002) by S.I. 2002/1501, arts. 1(1), 2(20)(c)

F36 Words in s. 31(4) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(5)(a) (with Sch. 5)

F37 S. 31(4)(a)-(e) inserted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 16(5)(b) (with Sch. 5)

Modifications etc. (not altering text)

C1 S. 31(1) extended (1.1.1993) by S.I. 1992/3218, reg. 82(1), Sch. 10 Pt. I para. 9

[F38 31A. (1) In this Act, references to deferred shares are to a class of shares where— U.K.

(a) the rights and obligations of the credit union and the member in respect of those shares are set out in a single document, or in a series of documents (“the issue documents”);

(b) each of the issue documents is provided to every applicant for the shares;

(c) one of the issue documents contains a prominent statement to the effect that the shares are deferred shares for the purposes of this Act;

(d) each of the issue documents contains a prominent statement stating whether the shares are, or are not, an investment covered by the Financial Services Compensation Scheme (see section 213 of the Financial Services and Markets Act 2000);

(e) any document evidencing title to the shares contains the statements required by paragraphs (c) and (d) above;

(f) one of the issue documents contains a term which prohibits the repayment of any principal to the shareholder except in Case A or Case B.

(2) Case A is the winding up or dissolution of the credit union in circumstances where all sums due from the credit union to creditors claiming in the winding up or dissolution are paid in full.

(3) Case B is where—

(a) the credit union applies to the [F39 appropriate authority] for consent to repay principal to the shareholder,

(b) the credit union so applies otherwise than in consequence of a provision in any of the issue documents which requires it to apply, grants it any benefit for applying or imposes a sanction against failure to apply, and

(c) the [F39 appropriate authority] grants consent.

(4) “Creditors” in subsection (2) above includes members holding shares, other than deferred shares, in the credit union, as regards the principal of those shares and any interest or dividend due on them.

(5) On any modification of the definition of “deferred shares” in the Building Societies Act 1986 or an instrument made under that Act, the Treasury may, by order, modify the meaning of deferred shares in this section so as to assimilate it to the modified definition.]

Textual Amendments

F38 S. 31A inserted (8.1.2012) by The Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011 (S.I. 2011/2687), arts. 1(1)(b), 17(4) (with arts. 25, 26)

F39 Words in s. 31A(3) substituted (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), art. 1(1), Sch. 6 para. 17 (with Sch. 12)

32 Northern Ireland. U.K.

(1) The Treasury may make reciprocal arrangements with the Department of Commerce for Northern Ireland or such other authority as may be specified for the purposes of this subsection by any Measure of the Northern Ireland Assembly with a view to securing that, on or after the commencement of this Act,—

(a) the law applicable in England and [F40 Wales, or (as the case may be) Scotland, to [F41 societies registered as credit unions under the 2014 Act]] may be applied, in such cases and subject to such modifications as may be provided in the arrangements, to Northern Ireland credit unions; and

(b) the law applicable in Northern Ireland to Northern Ireland credit unions may be applied, in such cases and subject to such modifications as may be provided in the arrangements, to [F42 societies registered as credit unions under the 2014 Act] ;

and [F43 section 142 of the 2014 Act ] (which enables societies registered in Northern Ireland to be treated for certain purposes as if they were registered under that Act) shall not apply to Northern Ireland credit unions.

(2) The Treasury may by regulations F44 . . . make provision for giving effect to any arrangements made under subsection (1) above, and such regulations may in particular—

(a) confer rights and obligations (appropriate to credit unions) under this Act and [F45 the 2014 Act ] on Northern Ireland credit unions in such circumstances as may be specified in the regulations;

(b) confer functions on [F46 each of the FCA and the PRA] in relation to Northern Ireland credit unions; and

(c) make such modifications of this Act, [F45 the 2014 Act ] and the M1 Government of Ireland (Companies, Societies, etc.) Order 1922 as appear to the Treasury to be expedient to give effect to the arrangements.

(3) In this section “Northern Ireland credit union” means a society registered as a credit union under the law of Northern Ireland.

(4) An Order in Council made under paragraph 1(1)(b) of Schedule 1 to the M2 Northern Ireland Act 1974 which contains a statement that its purposes correspond to those of this Act shall be subject to annulment in pursuance of a resolution of either House of Parliament instead of the Order, or a draft of the Order, being subject to the procedure set out in paragraph 1(4) or (5) of that Schedule.

Textual Amendments

F40 Words in s. 32(1)(a) substituted (1.12.2001) by S.I. 2001/2617, arts. 2(b), 13(1), Sch. 3 Pt. IV para. 290(a) (with art. 13(3)); S.I. 2001/3538, art. 2(1)

F41 Words in s. 32(1)(a) substituted (6.4.2018 immediately after 2016 c. 16 (N.I.), s. 8(2) comes into force) by The Financial Services Act 2012 (Mutual Societies) Order 2018 (S.I. 2018/323), art. 1, Sch. 4 para. 1 (with art. 3)

F42 Words in s. 32(1)(b) substituted (6.4.2018 immediately after 2016 c. 16 (N.I.), s. 8(2) comes into force) by The Financial Services Act 2012 (Mutual Societies) Order 2018 (S.I. 2018/323), art. 1, Sch. 4 para. 1 (with art. 3)

F43 Words in s. 32(1) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 17(2) (with Sch. 5)

F44 Words in s. 32(2) omitted (3.7.2002) by virtue of S.I. 2002/1555, arts. 1, 7(4)

F45 Words in s. 32(2) substituted (1.8.2014) by Co-operative and Community Benefit Societies Act 2014 (c. 14), s. 154, Sch. 4 para. 17(3) (with Sch. 5)

F46 Words in s. 32(2) substituted (1.4.2013) by The Financial Services Act 2012 (Mutual Societies) Order 2013 (S.I. 2013/496), art. 1(1), Sch. 6 para. 18(3) (with Sch. 12)

Marginal Citations

M1 S.R. & O. 1922 No. 184

M2 1974 c. 28.

33 Short title, commencement and extent. E+W+S

(1) This Act may be cited as the Credit Unions Act 1979.

(2) This section and section 32 above shall come into operation on the passing of this Act and the other provisions of this Act shall come into operation on such day as the Treasury may appoint by order made by statutory instrument; and different days may be so appointed for different provisions.

(3) Any reference in this Act to the commencement of any provision of this Act shall be construed as a reference to the day appointed under this section for the coming into operation of that provision.

(4) With the exception of[F47 section 23A so far as it confers power to make consequential amendments of enactments extending to Northern Ireland, ] section 25 and section 32(4) above, this Act does not extend to Northern Ireland.

Textual Amendments

F47 Words in s. 33(4) inserted (1.12.2013) by Co-operative and Community Benefit Societies and Credit Unions Act 2010 (c. 7), ss. 5(3), 8(2) (with s. 4(6)); S.I. 2013/2936, art. 2

Modifications etc. (not altering text)

C2 Power of appointment conferred by s. 33(2) partly exercised: S.I. 1979/936 and 1980/481