NEWFOUNDLAND REGULATION 27/98

Co-operative Societies Regulations (Amendment)
under the
Co-operative Societies Act

(Filed February 10, 1998)

Under the authority of section 72 of the Co-operative Societies Act, I make the following regulations.

Dated at St. John's, February 10, 1998.

Ernest McLean
Minister of Government Services and Lands

REGULATIONS

Analysis

        1.   S.11 R&S
Trade association

        2.   S.48 R&S
Liquidity

CNR 956/96
as amended

        1. Section 11 of the Co-operative Societies Regulations is repealed and the following substituted:

Trade association

      11. (1) For the purpose of this section

             (a)  "financial central" means a central incorporated under the laws of a province or the Government of Canada which is permitted to provide financial services to its members and affiliates and is a member of the Credit Union Central of Canada; and

             (b)  "trade association" means the Credit Union Central of Newfoundland and Labrador and the Alliance for Newfoundland and Labrador Credit Unions Limited, established under paragraph 5(c) of the Act.

             (2)  Membership in a trade association shall be open to all credit unions on a voluntary basis.

             (3)  The purpose of a trade association shall be to provide services consistent with that of a trade association as members may provide for in the constitution of the trade association and the registrar may approve, and the powers of the trade association are so limited.

             (4)  A trade association shall not have the capacity to carry out services which may be considered by the registrar to be those associated with a financial central and specifically shall not have the power to provide the services or carry out the activities including

             (a)  clearing and settlement services;

             (b)  the acceptance from members of deposits or investments of any type;

             (c)  electronic financial services;

             (d)  the lending of money or granting of credit facilities to members;

             (e)  holding investments in members;

              (f)  financial intermediary services, including those which would be usually carried out by a financial central; and

             (g)  other services which in the opinion of the registrar are of a financial nature.

             (5)  All credit unions shall be members of or affiliated with a financial central.

             (6)  A trade association which, in the opinion of the registrar, is in financial difficulty or not in compliance with the Act and regulations may be placed under the supervision of the Credit Union Deposit Guarantee Corporation or another supervisor appointed by the registrar.

        2. Section 48 of the regulations is repealed and the following substituted:

Liquidity

      48. (1) A credit union shall maintain as liquidity at least 10% of its liabilities in qualifying investments.

             (2)  A credit union shall participate in the National Liquidity Pool established by the Credit Union Central of Canada to provide a source of funds to the Credit Union Central of Canada for the purpose of assisting a credit union if its payment obligations exceed the deposits available to it with a financial central, and a credit union shall do those things required by the Credit Union Central of Canada to assure its participation.

             (3)  Qualifying investments for the purpose of this section are

             (a)  cash;

             (b)  unencumbered deposits in a financial central, under subsection 11(5), with a maturity of one year or less; and

             (c)  common shares issued by a financial central, under subsection 11(5) to a maximum of 2% of the liabilities of a credit union.

             (4)  The liquidity calculation will be completed monthly by all credit unions in the form prescribed by the Credit Union Deposit Guarantee Corporation.

(Includes reprint of March 6, 1998)

©Earl G. Tucker, Queen's Printer