Law on Cooperative Societies

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  • Country: Lebanon
  • Language: English
  • Document Type: Domestic Law or Regulation
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Encyclopedia of Arabic Legislations – Lebanon Cooperatives – Law

Cooperatives Law 1

Section One

Article 1 – The cooperative is a group composed of several individuals who unite their information and
efforts in a permanent fashion and the goal of which is not to divide profit.

Article 2 – 2 No permit is initially needed to found a cooperative. However, in all cases the government
must be notified of the cooperative after it is founded in accordance with Article 6.

Article 3 – Founding a cooperatives on any unlawful basis which violates the provisions of laws and public
documents or which aims to jeopardize the comfort of the monarchy and integrity of state property, change
the form of the current government, or politically di scriminate between different Ottoman members is not
permitted. The attestations of such will be refused and they will be dissolved by decree issued by the
Council of Ministers.

Article 4 – Founding political cooperatives the title or basis of which is national or sexual is forbidden.

Article 5 – Members of a cooperative must not be under 20 years of age, have been convicted of a crime, or
have been deprived of civil rights.

Article 6 – Founding secret cooperatives is strictly forbidden based on the fact that founders must
immediately provide a signed and stamped statement which includes the address of the cooperative,
statement of its goal, its main office, the names of those in charge of running its affairs as well as their titles
and location, to the Ministry of Interior if the coopera tive is centered in Istanbul or to the foremost civil
official if it is centered abroad. Along with providing this attestation, two copies of the statutes must be
attached to this statement which have been endorsed with the official s eal of the cooperative.

After attestation, the manner of operation is announced by the founders and the government must be
immediately informed of any amendment or change that occurs in the statutes of the cooperative, its
administrative body, or its location with the legal effect of such amendment or change being exercised on a
third party from the day the government is informed of it. This must be enumerated in a designated ledger
and presented to the judicial or civ il government at any time requested.

Article 7 – An administrative body must be present at the main office of each cooper ative and consist of at
least two persons and, if the cooperative has branches, each branch must have an administrative body
connected to the central body and th ese bodies must keep three ledgers. The first of these contains the
identity of the members of the cooperative and the date that they joined. The second contains the
headquarters of the admini strative body, its correspond ence, and notifications. The third contains the type
and amount of receipts and expenses of the cooperative. These ledgers must be presented to the judicial
and civil government at any time requested.

Article 8 – Each cooperative having provided a statement acco rding to Article 6 can advance to the courts
through an intermediary as either plaintiff or defend ant, as mentioned in Article 9, and can manage and
administer, with the excepti on of any necessary subsidies from the state: 1) the monetary shares given to it
by members on the condition that the shares do not exceed 24 gold coins per year; 2) the location
designated for administering the coop erative and the meeting of its members; 3) the non-moveable assets
necessary for carrying out the intended goal as given in its own statutes. Cooperatives are prohibited from
administering non-moveable property other than this.

1 Issued on 8/3/1325 – 1909 2 Amended in the law issued 5/26/1938

Article 9 – Requests and claims raised to commissioners, courts and formal councils in the name of a
cooperatives for the sake of its interests cannot be conducted except by means of a sealed petition which
has been signed and stamped by the director or the gene ral secretary with his personal signature and stamp.
The identity of individuals such as these operating in the name of the cooperative is stated in the statutes of
the cooperative.

Article 10 – A member of a cooperative can resign at any time he wishes, even if the statutes dictate
otherwise, but only after fulfilling the monetary portion of the current year which has begun.

Article 11 – Cooperatives are prohibited from bringing to or keeping on the premises of its meeting place
all types of firearms or injurious weapons except for those clubs specializing in fishing and sword fighting
where, with the knowledge of the police, the weapons needed can be present in the required amount.

Article 12 – The founder, administrativ e body and owner or renter of the meeting place of cooperatives that
do not declare themselves and notify the government by providing it with the statement in accordance with
Articles 2 and 6, are punished with a monetary fine of five to 25 gold coins in addition to the cooperative
being banned by the government. Likewise, if the cooperative has been founded for one of the harmful or
prohibited purposes outlined in Article 3 or the two penal codes, th en each party is sentenced individually
with the fine particular to that law.

Those who participate in a cooperative, committee, or body in any manner which directly or by means of
an intermediary seeks to jeopardize the operation of the public good is punished with imprisonment of six
months to three years, with a monetary fine of 25 to 200 Lebanese-Syrian Lira, or with one of these two

Article 13 – Those who violate the provisions of Articles 4, 5, 7 and 9 and the related notification and
declaration in the provisions of Article 6 are punished with a monetary fine of two to ten gold coins and,
upon repeat offense, with double this amount. Those who violate this law by maintaining a cooperative
that has been banned in accordance with Article 12 or who renews its establishment and administration is
punished with a monetary fine of 10 to 50 gold coins and imprisonment of two months to one year.
Anyone who turns a location belonging to him into a meeting place for a banned cooperative is punished

Article 14 – If a cooperative has been banned by the government or dissolved with the consent and option
of its members or by virtue of its internal statutes and a text exists in the statutes regarding its assets, then
this is placed in operation. Otherwise, the resolution given by the general body of the cooperative is placed
in operation. If a cooperative has been banned and was founded for one of the harmful or prohibited goals
mentioned previously in Article 3, the government takes and retains its assets.

Article 15 – Clubs are treated like the cooperatives discussed in this chapter.

Article 16 – Those cooperatives which presently exist must, within two months from the date this law is
published, provide the statement an d fulfill the condition of declaration in accordance with Articles 2 and 6
and be successful in operating according to the provisions of all articles.

Section Two

Article 17 – Whether the cooperative is considered to serv e the public welfare is dependent on agreement
of the state to a resolution from the State Counsel. This type of cooperative can perform all the lawful and
non-prohibited transactions of its st atutes. Shares and drafts owned by the cooperative should in all cases
by enumerated and, for those belonging to the bearer, be converted to its name. As for assets gifted or
willed to the cooperative, which ca nnot be non-moveable except with special permit from the government,
if the gifted or willed item is a non-moveable asset an d there is no need for it to perform a function of the
cooperative, then it is sold and stated in the reso lution the acceptance of which specified the time period
3 This paragraph added to Legislative Act / Decree No. 41 of 9/28/1932

during which the item had to be sold. Money obtained in place of the item sold is turned over to the fund
of the cooperative.

Article 18 – The police must inspect cooperatives and clubs and they must therefore open their meeting
places at all times to the police commissioners but only once the commissioners have demonstrated, as
necessary, that the entrance to the meeting place is based on real need. They must produce an official paper
which includes the order and occassion for entering that location which is given to them in Istanbul by the
Ministry of Police and in the administ rative districts by the foremost local civil official or his appointee.

Article 19 – The Ministers of Interior and Justice ar e charged with execution of this law.