25.1 The most common reasons provided in cooperative laws for winding up cooperatives are:
Societies do not commence working or cease working for the desired period (Bangladesh, India, Philippines, Nepal, Fiji, Malaysia, and Sri Lanka);
Resolution of the General Assembly by more than quorum as provided in the law (all countries);
The number of memberships decreases to a level below a set number (most countries);
Violation of or non-compliance with the laws and bye-laws (all countries);
Other common reasons for winding up are:
Bankruptcy (South Korea, Japan, Thailand);
Share capital and deposit less than Takka 500 (Bangladesh);
A Registrar decision to wind up after inquiry and/or inspection (Bangladesh, India, Indonesia, Sri Lanka, Fiji, Nepal, and Malaysia);
Expiration of a set society existence period (Philippines, Japan);
Activities of the society have become prejudicial to the general order or social ethics (Indonesia);
Registration by fraud (Philippines);
Society exists for an unlawful purpose (Philippines);
Unable to operate successfully or operations are prejudicial to the society or common interests or cooperatives are dissolved by the resolution of general meeting (Thailand);
Illegal acts (Japanese law, section 95 in), and;
Order of dissolution by competent minister (South Korea).
25.2 While the grounds for winding up in most laws are reasonable, in actual practice the winding up process is a lengthy process. In some cases it may take decades, although under most laws a time limit is prescribed. The suggestions therefore are:
In cases of voluntary dissolution the society may be allowed to carry out its own winding up process within a time frame prescribed by the registering authority.
In cases where the liquidation process takes more than one year, they should be de-listed from the records of registered society and a separate record of such societies be maintained.
In cases where a society has failed to uphold quorum at three Annual General Assemblies, consequently it should be brought under liquidation as this is a clear indication that members are no longer interested in the society.
