600 cooperatives risk losing licences

Last year`s amendment of Law No 50/2007 of 18/09/2007 which determines the establishment, organisation and functioning of cooperative organisations, may lead to the annulment of operating licences of 600 cooperatives.A total of 15 articles were amended including Article 10 that not only raises the minimum number of members allowed to form a cooperative to 10 from 7 but also limits a nuclear family from forming one.Article 77 empowers the regulator, Rwanda Cooperative Agency (RCA), to suspend cooperative leaders upon failure to submit documents to prove that a cooperative `is functioning while Article 88 requires cooperatives to submit administrative and management reports to RCA after every three month, in addition to declaring and publishing balance sheets every financial year.“As soon as the law was published in the official gazette, we started a massive sensitisation campaign to create awareness of what these cooperatives are meant to do to abide by the law,” said Damien Mugabo, the Director General of the RCA in a telephone interview.He added that besides the media, district cooperative officers have also been charged with sharing of information on the amended law.During this year`s International Day of Cooperatives, Mugabo announced that 4,432 cooperatives had met the legal requirements, adding that various measures are in place to protect the interests of their members.Records from RCA indicate that some of the 600 cooperatives were registered even before then enactment of the 2007 law.In case the 600 cooperatives lose their operating licenses, it will be the second time for RCA to apply the law after a recent campaign to crack down on ‘ghost’ cooperatives that saw the dissolving of 51 cooperatives.RCA`s Deputy Director General, Gilbert Habyarimana, called upon cooperatives’ officials to conform to the law to shield members.“It is all about protecting cooperative members who can easily be affected with wrong actions that might lead to embezzlement of funds, thereby undermining the real cause of government’s encouragement to the population to join cooperatives in fighting against poverty,” he said.

National

600 cooperatives risk losing licences