Fiji’s cooperative law was introduced by the British Ordinance in 1947; however, cooperatives already existed in the agricultural and dairy sectors. Following independence, the British ordinance was adopted as law, until it was replaced by the Co-operatives Act 1996, to encourage greater cooperative autonomy. This analysis provides a general overview of Fiji’s Co-operatives Act, 1996 and Co-operatives Regulation 1999.
Main laws relevant to cooperatives in Fiji
Co-operatives Regulation, 1999
Section 5 of the Co-operatives Act,1996 states that a cooperative shall observe the cooperative principles in its operations and goes on to set out the cooperative principles as set out in the 1995 Statement of cooperative identity.
The Co-operative Act 1996 is limitedly cooperative friendly because it relies heavily on a well-resourced cooperative registry to ensure that cooperatives comply with certain aspects like auditing and reporting, thus not fully supporting the cooperative principle of Autonomy and Independence. However, it is a good example of a well-drafted and easy to read legislative framework for cooperatives.
Key recommendations for improvement
- The problem of compliance with audit requirements can be addressed by introducing simplified compliance requirements for ‘small’ cooperatives, where they can opt-out of the obligation to have their financial records audited annually. The cooperative’s financials can be externally reviewed.
- Also, the small cooperatives need not lodge their financial statements with the registry but instead complete and lodge an ‘annual return’ which allows the registry to capture data in a streamlined way.
- The governance issue of weak boards can be addressed by allowing a board to have non-member directors if member directors always outnumber non-member directors when any decision is made.
Fiji has a vibrant cooperative sector that is supported by friendly cooperative legislation. The Co-operative Act 1996 is currently under review (as of March 2020) thus providing a good opportunity to ensure that government ministers are made aware of the importance of the sector.
The legal frameworks analysis is a tool developed under the ICA-EU Partnership #coops4dev. It is an overview of the national legal frameworks at the time of writing. The views expressed within are not necessarily those of the ICA, nor does a reference to any specific content constitute an explicit endorsement or recommendation by the ICA.