Legal News for UK Co-ops and Mutuals

This is a blog where brief information about developments in UK Co-op and mutual law will be reported. Readers of this blog will also find Linda Barlow's Co-operatives UK Blog at helpful. For an network of academics working on co-ops, mutuals and social enterprises visit

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Location: Leicestershire, United Kingdom

Interested in sharing information and knowledge around legal issues for co-ops and social enterprises in the co-oplawnews blog and thoughts on random issues in the "real" blog.

Wednesday, May 23, 2012

Non-User Investor Members in UK Co-operatives

2006 saw the liberalisation of FSA policy on the use of “investor shares” for non-user investor members. The FSA document permits co-operatives to have non-user investor members who hold “Investor Shares”, subject to restrictions to protect the interests of user members. These include restricted voting rights for investor members, compliance with applicable regulatory requirements under FSMA 2000, and an overriding requirement that the society remains, in the FSA’s view, a “bona fide co-operative” (Investor Membershipof Co-operatives registered under the Industrial and ProvidentSocieties Act 1965 A Policy Note by Michael Cook and Ramona Taylor, Financial Services Authority, 2006). This change was uncontroversial among those consulted by the FSA as it addressed the need of co-operatives to raise capital.

However, it may be of considerably more use and interest now that the statutory limit on holdings by members other than industrial and provident societies has been removed for non-withdrawable shares in societies.

© Ian Snaith 2012 This work is licensed under the Creative Commons Attribution-NonCommercial-Noderivs 2.0 England and Wales Licence. To view a copy of this licence visit or send a letter to Creative Commons, 559 Nathan Abbott Way, Stanford, California 94305, USA


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