Definitions and interpretation

1  (1)  In this Act and the Company Act as it applies for the purposes of this Act:

"auxiliary member" means a person who is an auxiliary member of a credit union under section 46;

"business authorization" means an authorization to carry on

(a) deposit business, or

(b) both deposit business and trust business,

issued or deemed to be issued under division 1 of Part 3 of the Financial Institutions Act to a credit union;

"capital base" has the same meaning for the purposes of this Act as it has under the Financial Institutions Act;

"central credit union" means a credit union in which membership is restricted to credit unions, other corporations, public bodies or the Crown in right of Canada or British Columbia or in any other right;

"child" of a person includes the child of the person's spouse;

"commission" means the Financial Institutions Commission under the Financial Institutions Act;

"Company Act" means, except in subsection (4) of this section, the Company Act, R.S.B.C. 1996, c. 62, as that Act is applied under subsection (4) of this section;

"constitution" means the document described in section 6 (1) and includes the constitution of a credit union incorporated under the Credit Union Act, R.S.B.C. 1979, c. 79, or incorporated under a former Credit Unions Act;

"credit union" means a corporation incorporated as a credit union under this Act, the Credit Union Act, R.S.B.C. 1979, c. 79, or a former Credit Unions Act, and includes a central credit union and a credit union continued into British Columbia under section 15.1, but does not include a credit union continued under the laws of another jurisdiction under section 15.2;

"debenture" includes an instrument, secured or unsecured, issued by a credit union which instrument is

(a) in bearer or registered form,

(b) of a kind commonly dealt in on securities exchanges or markets, or commonly recognized in any area in which it is issued or dealt in as a medium for investment, and

(c) evidence of an obligation or indebtedness of the credit union,

but does not include

(d) a negotiable unsecured promissory note maturing not more than one year after the date of issue,

(e) a receipt or another type of instrument issued by a credit union evidencing

(i)  a deposit, or

(ii)  an annuity payment, or

(f) an investment contract or mutual fund certificate;

"deposit business" means the business of receiving on deposit or soliciting for deposit money that is repayable

(a) on demand,

(b) after notice,

(c) on the expiry of a specified term, or

(d) at specified intervals for a specified term;

"deposit insurance corporation" means the Credit Union Deposit Insurance Corporation of British Columbia continued under the Financial Institutions Act;

"depositor" means a person who has money on deposit with a credit union, and includes a person who holds non-equity shares in a credit union;

"entity" includes a corporation, trust, partnership, fund or other unincorporated association or organization, the Crown in right of Canada or of a province, a Crown agent, a foreign government and an agency of a foreign government, but does not include an individual;

"equity share" means a share in a credit union that represents an equity interest in a credit union;

"extraprovincial credit union" means a credit union incorporated by or under the laws of a jurisdiction other than British Columbia and that is, under those laws, licensed, registered or in any way authorized to carry on activities that are substantially the same as trust business or deposit business or both;

"fair market value" means the amount, price, consideration or rent that would be obtained in an arm's length transaction in the open market between willing parties acting in good faith;

"fund" means the fund continued under section 267 of the Financial Institutions Act;

"general insurance" means insurance that is not life insurance;

"member" means a person who has been admitted to membership or junior membership in a credit union and whose name is entered in its register of members, but does not include a person who is an auxiliary member;

"membership shares" means the shares of a distinct class of equity shares that, under section 44 (2) or (3), are the membership shares in a credit union;

"non-equity share" means a share in a credit union that

(a) evidences indebtedness of the credit union to the holder of the share, and

(b) does not represent an equity interest in the credit union;

"public body" means

(a) a municipality or regional district,

(b) [Repealed 2003-52-45.]

(c) the Municipal Finance Authority of British Columbia under the Municipal Finance Authority Act,

(d) a government body under the Financial Administration Act, or

(e) a board, commission, authority or similar body established or authorized under an Act to administer, regulate, manage or undertake the operation of schools, libraries, hospitals, health facilities, irrigation systems, drainage systems, water supply systems, local improvements or public utilities, or to regulate or facilitate the regulation of agricultural and other natural products marketing, or to levy or raise taxes under the authority of an Act;

"rules" means the rules described in section 7 and includes the rules of a credit union incorporated under the Credit Union Act, R.S.B.C. 1979, c. 79, or incorporated under a former Credit Unions Act;

"security instrument" means security as defined in section 1 of the Securities Act;

"senior officer" means each of the 5 highest paid officers of a credit union and includes an individual who, whether or not among the 5 highest paid officers,

(a) is the chair or a vice chair of the board of directors or the president, a vice president, the secretary, the treasurer or the general manager of the credit union, or

(b) performs functions of the credit union similar to those normally performed by an individual occupying any of the offices described in paragraph (a);

"special resolution" means a resolution of which the notice required under section 78 has been given, and,

(a) in respect of a credit union other than a central credit union, or in respect of a central credit union the rules of which do not provide for that category of resolution as set out in section 92 (1.1), a resolution of the credit union or central credit union, passed by a majority of not less than 2/3 of the votes cast by members who are entitled to vote and,

(i)  if the rules of the credit union provide as set out in section 72 or 73, who vote by any of the methods permitted under those rules, or

(ii)  if the rules of the credit union do not provide as set out in section 72 or 73, who vote at a general meeting

(A)  in person,

(B)  through a representative who is present in person, if permitted by section 70 (3), or

(C)  by a delegate who is present in person, if, in the case of a central credit union, the rules of the central credit union provide as set out in section 92 (1) (b) for voting by delegates, or

(b) in respect of a central credit union the rules of which provide for that category of resolution as set out in section 92 (1.1), a resolution of the central credit union, passed as permitted under those rules by a majority of votes that are cast by members who are entitled to vote and,

(i)  if the rules of the central credit union provide as set out in section 72, who vote by any of the methods permitted under those rules, or

(ii)  if the rules of the central credit union do not provide as set out in section 72, who vote at a general meeting

(A)  in person,

(B)  through a representative who is present in person, if permitted by section 70 (3), or

(C)  by a delegate who is present in person, if the rules of the central credit union provide as set out in section 92 (1) (b) for voting by delegates;

"spouse" means a person who

(a) is married to another person, or

(b) is living and cohabiting with another person in a marriage-like relationship, including a marriage-like relationship between persons of the same gender;

"superintendent" means the Superintendent of Financial Institutions appointed under the Financial Institutions Act;

"tribunal" means the Financial Services Tribunal under the Financial Institutions Act;

"trust business" means the business of providing or offering to provide services to the public as any of the following:

(a) trustee, executor or administrator;

(b) guardian of a minor's estate;

(c) committee of a mentally disordered person's estate;

(d) representative under the Representation Agreement Act.

(2)  For the purposes of this Act and the Company Act as it applies for the purposes of this Act,

(a) an affiliate of a credit union is deemed to be affiliated with all corporations with which the credit union is affiliated, and

(b) a credit union is deemed to be affiliated with all corporations with which an affiliate of the credit union is affiliated.

(3)  Subject to subsections (1) and (2) and unless the context otherwise requires, words and expressions used in the Company Act, whether or not defined in that Act, have the same meaning for the purposes of this Act as they have in the Company Act.

(4)  Despite the repeal of the Company Act, R.S.B.C. 1996, c. 62,

(a) a reference in this Act to the Company Act is deemed to be a reference to the Company Act, R.S.B.C. 1996, c. 62, and

(b) the provisions of the Company Act, R.S.B.C. 1996, c. 62, continue to apply, as though that Act had not been repealed, to and in respect of every credit union in the manner and to the extent provided by this Act.

Application of other Acts

2  Except as provided in this Act or the Financial Institutions Act, the Company Act and the Business Corporations Act do not apply to a credit union.

Application of Company Act to credit unions

3  Subject to sections 4 and 5, for the purposes of this Act the following provisions of the Company Act apply to and in respect of credit unions:

(a) Part 2, Incorporation, except sections 5, 6, 8, 9, 11, 15 to 17, 18 (1), (7), (9) and (10), 20, 21, 23, 24, 27 to 31 and 34 to 38;

(b) Part 3, Finance, except sections 41, 44, 46, 48 to 51, 56 to 58, 65 to 74, 76 to 79, 86 to 98 and 99 (a) to (d);

(c) Part 7, Proceedings, except sections 200 and 206 to 215;

(d) Part 8, Company Alterations, except sections 222 and 224 to 255;

(e) Part 9, Dissolution and Restoration, except sections 256 to 266, 270, 272, 275 (2) (a), 276, 278 (a), 279 (1) (b) and (2), 282 (d), 289 (2), 292 (3) and 294;

(f) Part 11, Administration, except sections 335 and 341 to 350.

General rules respecting Company Act interpretation

4  (1)  In this section:

"Company Act" means the Company Act as it applies for the purposes of this Act;

"voting share" means a share of a class of shares of a corporation that carries the right to vote under all circumstances on a resolution electing directors, and includes a share of a class of shares of a corporation that carries the right to vote on such a resolution because of the occurrence of a contingency that has occurred and is continuing.

(2)  A reference in the Company Act to any of Forms 1 to 23 in the Second Schedule to that Act must be read as a reference to the corresponding form prescribed for the purposes of this Act.

(3)  A reference to "company" or "corporation" in the Company Act must be read as a reference to "credit union", as the context requires.

(4)  A reference to "reporting company" in the Company Act must be read as a reference to "credit union".

(5)  [Repealed 2004-48-2.]

(6)  A reference to "memorandum" or "articles" in the Company Act must be read as including "constitution" and "rules" respectively of a credit union.

(7)  A reference to "subsidiary" in this Act or in the Company Act must be read as including a corporation other than a central credit union or a corporation designated by regulation, if the corporation is controlled, within the meaning of subsection (8), by

(a) a credit union and one or more other credit unions, or

(b) a credit union and one or more other credit unions, and one or more other corporations if each of the other corporations is controlled by one or more credit unions,

and "holding company" has the corresponding meaning.

(8)  For the purpose of subsection (7), a corporation is controlled by a group described in subsection (7) (a) or a group described in subsection (7) (b), as the case may be,

(a) if

(i)  more than 50% of the voting shares in the corporation are held, other than by way of security only, by or for the benefit of that group, and

(ii)  the votes carried by those voting shares are sufficient, if exercised, to elect a majority of the directors of the corporation, or

(b) if

(i)  the charter of the corporation provides that the majority, or

(ii)  the corporation is party to an agreement or arrangement under which the majority

of the corporation's directors must be nominees of that group.

Specific rules respecting Company Act interpretation

5  (1)  In this section, "Company Act" means the Company Act as it applies for the purposes of this Act.

(2)  The references to "member" or "members" in sections 45, 52, 55 and 60 to 62 of the Company Act must be read as references to "equity shareholder" or "equity shareholders".

(3)  Sections 75 and 80 to 85 of the Company Act do not apply in respect of a mortgage or debenture issued by a credit union before June 25, 1975, but, despite any limitation as to time, a credit union may register a mortgage or debenture issued by it before then, and, on registration, those sections apply in respect of the mortgage or debenture.

(4)  The references to "debenture" or "debentures" in sections 80 to 85 of the Company Act must be read as not including

(a) an assignment of book accounts within the meaning of the Book Accounts Assignment Act, R.S.B.C. 1979, c. 32,

(b) a mortgage of land only, or

(c) an instrument charging personal property only and required to be registered under the Chattel Mortgage Act, R.S.B.C. 1979, c. 48,

and the references to "debenture holders" in section 85 of the Company Act have a corresponding meaning.

(5)  The references to "registrar" in section 223 (1) of the Company Act must be read as references to "commission".

(6)  The reference to "the minister" in sections 271 (1) and 287 of the Company Act must be read as a reference to "the commission".

Application for incorporation

6  (1)  Subject to this division, 25 or more persons who

(a) propose to form a credit union for the purpose of carrying on deposit business or both deposit business and trust business,

(b) complete an application in the prescribed form, and

(c) file the completed application with the superintendent,

may form a credit union by

(d) subscribing to a constitution prepared in accordance with subsection (2),

(e) adopting a common bond of membership that meets the requirements of section 40 (1), and

(f) adopting rules prepared in accordance with section 7.

(2)  The constitution must

(a) be printed or typewritten,

(b) be divided into paragraphs numbered consecutively,

(c) contain the agreement of each subscriber to be a member of the credit union, and

(d) contain the restrictions, if any, other than those imposed under this Act or the Financial Institutions Act, on the business to be carried on by the credit union or on the powers of the credit union.

Rules

7  (1)  A credit union must have rules for its conduct.

(2)  The rules must be

(a) printed or typewritten, and

(b) divided into paragraphs numbered consecutively.

(3)  A credit union may, by its rules, adopt all or any of the prescribed model rules.

Registration documents

8  On the registrar receiving

(a) the constitution,

(b) the common bond of membership,

(c) the rules, and

(d) a notice of the credit union's

(i)  registered office,

(ii)  records office, and

(iii)  offices in which the credit union proposes to carry on business,

the registrar, subject to section 11, must register the constitution, common bond of membership and rules and enter the name of the credit union in the register of financial institutions.

Evidence of incorporation

9  On registration under section 8 the registrar must

(a) issue a certificate of incorporation showing that the credit union is incorporated under this Act, and

(b) publish notice of the incorporation in the Gazette.

Conclusiveness of certificate

10  A certificate of incorporation is conclusive evidence that the credit union has been incorporated under this Act, under the Credit Union Act, R.S.B.C. 1979, c. 79, or under a former Credit Unions Act.

Commission's consent to incorporation

11  (1)  In this section, "subscribers" means the persons applying to incorporate a credit union.

(2)  The registrar must not register the constitution and rules of a credit union or enter its name in the register of financial institutions without first receiving the consent of the commission to the incorporation.

(3)  The commission must not consent to the incorporation of a credit union unless

(a) the subscribers have

(i)  submitted to the commission the proposed constitution, common bond of membership and rules of the proposed credit union, and

(ii)  paid the prescribed fee,

(b) the subscribers have submitted to the commission a plan

(i)  specifying the names and addresses of the individuals proposed by the subscribers as the first directors and senior officers of the proposed credit union,

(ii)  specifying whether the business proposed to be carried on by the proposed credit union is deposit business or both deposit business and trust business,

(iii)  specifying the services that the proposed credit union intends to offer to its members,

(iv)  describing, in detail satisfactory to the commission, the period within which the proposed credit union will meet the requirements for being issued a business authorization and specifying the preliminary activities, not being trust business or deposit business, that the proposed credit union proposes to carry on during that period, and

(v)  containing prescribed additional information,

(c) the proposed constitution and rules comply with this Act and the regulations,

(d) the commission is satisfied that the preliminary activities set out in the plan under paragraph (b) are appropriate and in compliance with this Act,

(e) each of the proposed first directors and senior officers of the credit union has completed and submitted to the commission a personal information return in the prescribed form and disclosing the prescribed information,

(f) the subscribers have satisfied the commission that the proposed credit union intends to obtain, and will be able to obtain, a business authorization to enable it to offer to the public, within a reasonable time after the incorporation, the services set out in the plan under paragraph (b),

(g) the subscribers and proposed directors of the credit union are residents of British Columbia,

(h) the proposed common bond of membership complies with this Act,

(i) the subscribers have satisfied the commission that the proposed credit union will have both the financial and managerial capacity to properly carry on the business proposed to be carried on by it in compliance with this Act,

(j) the commission is satisfied that

(i)  the formation of the proposed credit union will be for the convenience and advantage of the members, and

(ii)  the proposed credit union will be operated in a manner in which the investments and deposits of members will be safeguarded without likelihood of a claim on the fund, and

(k) the commission believes on reasonable grounds that it is not contrary to the public interest to consent to the incorporation.

(4)  [Repealed 2004-48-4.]

(5)  The commission may conduct an investigation and a subscriber must provide to the commission information, verifications, forecasts of business operations or documents that the commission considers necessary in relation to the proposed incorporation.

Power and capacity of credit unions

12  A credit union has the power and capacity of a natural person of full capacity.

Preliminary activities

13  (1)  A credit union that is incorporated but that does not have a business authorization must not undertake any activity other than an activity specified under section 11 (3) (b) (iv) as a preliminary activity in the plan described in section 11 (3) (b).

(2)  Until a credit union receives a business authorization, the credit union, in every written communication, advertisement and document in which the name of the credit union appears, must add the following immediately after the name: "(Not authorized)".

Name

14  (1)  A credit union that proposes or is authorized to carry on business must have and use a name that includes the words "credit union", "caisse populaire" or "caisse d'economie".

(2)  The name of a credit union is subject to the approval of the commission.

(3)  A person must not assume or use in British Columbia, or carry on any business in British Columbia under, a name that includes the words "credit union", "caisse populaire" or "caisse d'economie" or use any words in connection with the business of the person in a way likely

(a) to deceive or mislead the public, or

(b) to give a false impression that the person is a credit union.

Commission's consent

15  The registrar must not accept for filing

(a) a resolution, referred to in section 217 (3) of the Company Act as it applies for the purposes of this Act, to alter the constitution of a credit union, or

(b) a resolution, referred to in section 219 (2) of the Company Act as it applies for the purposes of this Act, to alter the rules of a credit union,

without first receiving the consent of the commission.

Transfer of incorporation to British Columbia

15.1  (1)  Subject to this section, an extraprovincial credit union, if it appears to the registrar to be authorized to do so by the laws of the jurisdiction in which it is incorporated, may deliver to the registrar an instrument of continuation in duplicate continuing the extraprovincial credit union as if it had been incorporated under this Act.

(2)  The instrument of continuation must

(a) set out prescribed matters,

(b) be executed under seal and signed by an officer or director of the extraprovincial credit union and verified by an affidavit of the person signing the instrument of continuation, and

(c) be accompanied by other material required by the registrar.

(3)  The instrument of continuation must make the amendments to the charter of the extraprovincial credit union that are necessary to make the instrument conform to the laws of British Columbia and may make other amendments permitted under this Act as if the extraprovincial credit union were incorporated under this Act as a credit union.

(4)  If the registrar receives from an extraprovincial credit union under subsection (1)

(a) an instrument of continuation that complies with subsections (2) and (3),

(b) the prescribed fees, and

(c) the consent of the commission and the deposit insurance corporation,

the registrar must file one duplicate of the instrument of continuation and issue to the extraprovincial credit union a certificate of continuation to which the registrar must affix the other duplicate.

(5)  The commission must not consent under subsection (4) (c)

(a) unless

(i)  the directors of the extraprovincial credit union have submitted to the commission

(A)  the name and address of the extraprovincial credit union,

(B)  the financial statements of the extraprovincial credit union,

(C)  the constitution and rules proposed for the continued credit union, and

(D)  a plan for the continued credit union

(I) specifying whether the business proposed to be carried on is deposit business or trust business or both deposit business and trust business,

(II) specifying the services that the continued credit union intends to offer to the public,

(III) describing in detail satisfactory to the commission the period within which the credit union will meet the requirements for being issued a business authorization under the Financial Institutions Act and specifying the preliminary activities, not being deposit business or trust business, that the credit union proposes to carry on during that period, and

(IV) containing other information required by the commission,

(ii)  the commission approves the constitution and rules submitted under paragraph (a), and

(iii)  each proposed director and senior officer of the continued credit union has completed and submitted to the commission a personal information return in the form established by the commission that discloses the information required by the commission, and

(b) unless the commission believes on reasonable grounds that it is in the public interest to consent to the continuation.

(6)  In addition to the requirements under subsection (5), the commission must not give a consent referred to in subsection (4) (c) unless satisfied that the extraprovincial credit union, in its primary jurisdiction as defined in section 157 of the Financial Institutions Act, is licensed, registered or authorized to carry on deposit business or trust business.

(7)  On and after the date in a certificate of continuation issued to an extraprovincial credit union under subsection (4), this Act applies to the continued credit union to the same extent as if it had been incorporated under this Act as a credit union.

(8)  A business authorization that an extraprovincial credit union has immediately before the date that a certificate of continuation is issued to the extraprovincial credit union under this section continues in force on and after that date, subject to a subsequent surrender of the business authorization, and to any amendment or the suspension, revocation or cancellation of the business authorization, under this Act.

Transfer of incorporation from British Columbia

15.2  (1)  A credit union, if authorized by

(a) a special resolution,

(b) the consent given by the commission and the deposit insurance corporation for the purpose of this section, and

(c) the laws of another jurisdiction,

may apply to the proper officer of that other jurisdiction for an instrument of continuation continuing the credit union as if it had been incorporated under the laws of that other jurisdiction.

(2)  A credit union ceases to be a credit union under this Act on and after the date on which it is continued under the laws of the other jurisdiction and the credit union must promptly file with the registrar and the commission a copy of the instrument of continuation certified by the proper officer of the other jurisdiction.

Effect of continuation

15.3  All rights of creditors against the property, rights and assets of an extraprovincial credit union continued under section 15.1 as a credit union and all liens on its property, rights and assets are unimpaired by the continuation, and all debts, contracts, liabilities and duties of the credit union from then on attach to the continued credit union and may be enforced against it.

Business acquisition by asset transfer

16  (1)  A credit union (the "transferring credit union") may dispose of all or substantially all of its assets to another credit union (the "acquiring credit union"), but must not do so except in accordance with this section.

(2)  A transferring credit union that intends, or under section 277 (g) of the Financial Institutions Act is ordered, to dispose of all or substantially all of its assets to an acquiring credit union, together with the acquiring credit union, must propose and submit to the commission an asset transfer agreement that specifies the following:

(a) the services that the acquiring credit union offers to its members and proposes to extend to members of the transferring credit union;

(b) the common bond of membership proposed for the acquiring credit union on and after the disposition becomes effective;

(c) the manner in which the issued and unissued shares of the transferring credit union will be exchanged for those of the acquiring credit union;

(d) the fair market value of the equity shares of any class in the transferring credit union, or a method of determining the fair market value of those equity shares of any class, for the purpose of section 24;

(e) a description of any of the transferring credit union's assets that are not being disposed of to the acquiring credit union, together with a statement showing how those assets are to be disposed of;

(f) a description of any of the transferring credit union's liabilities that are not being assumed by the acquiring credit union, together with a statement showing how those liabilities are to be dealt with;

(g) that the date of disposition to the acquiring credit union is to be the date stipulated under subsection (7) by the commission as the effective date of the asset transfer agreement.

(3)  On receiving a proposed asset transfer agreement submitted to the commission, including one where the transferring credit union is acting under section 17 through an administrator,

(a) the commission may consent to the proposed asset transfer agreement, or

(b) if the commission considers that the proposed asset transfer agreement is contrary to the interests of the transferring credit union, the acquiring credit union or the members of either, the commission may refuse to consent to it.

(4)  If the commission consents under subsection (3) to a proposed asset transfer agreement under which the transferring credit union is one that is not acting under section 17 through an administrator, then this subsection applies to the transferring credit union, and it must

(a) submit the proposed asset transfer agreement to its members for approval by special resolution, if it is a credit union that has issued no equity shares or has issued no equity shares other than the membership shares, or

(b) submit the proposed asset transfer agreement

(i)  to its members for approval by special resolution, and

(ii)  to the holders of each class of equity shares other than the membership shares for approval by a separate resolution of the holders of that class, requiring a majority of 2/3 of the votes cast,

if it is a credit union that has issued 2 or more classes of equity shares.

(5)  If a transferring credit union to which subsection (4) applies has provided in its rules as set out in section 58 (2) respecting rights or special rights attached to its issued equity shares, then, on a separate resolution required under subsection (4) (b) (ii), each holder of equity shares has one vote in respect of each equity share held by that holder.

(6)  If the members or the members and other equity shareholders, as the case may be, of a transferring credit union to which subsection (4) applies have approved the proposed asset transfer agreement in compliance with subsections (4) and (5), the transferring credit union may enter into the proposed asset transfer agreement, which, when executed by the transferring credit union and the acquiring credit union, must be delivered to the commission together with a certified copy of each of any resolutions required in respect of a transferring credit union to which subsection (4) applies.

(7)  On being satisfied

(a) as to the disposition of any assets not being disposed of under an asset transfer agreement, including one where the transferring credit union is acting under section 17 through an administrator, and

(b) that any liabilities that are not being assumed under the asset transfer agreement by the acquiring credit union have been adequately dealt with,

the commission must stipulate, as the effective date of the asset transfer agreement, a date not earlier than the date the commission receives the executed asset transfer agreement, and the commission must deliver

(c) the executed asset transfer agreement, and

(d) a certified copy of each of any resolutions required under subsection (4)

to the registrar together with written notice of the stipulated effective date.

(8)  On receiving the executed asset transfer agreement, or the executed asset transfer agreement and a certified copy of each of any resolutions, delivered by the commission under subsection (7), the registrar must

(a) register the agreement or the agreement and a certified copy of each resolution, as the case may be,

(b) issue a certificate of business acquisition showing that, on the effective date (to be put in the certificate) stipulated by the commission under subsection (7), the acquiring credit union will have acquired the assets and assumed the liabilities of the transferring credit union and will carry on the business of both credit unions, and

(c) publish in the Gazette a notice of the business acquisition showing the name and registered office of the acquiring credit union, the name of the transferring credit union and the date of the business acquisition.

Business acquisition directed by commission

17  (1)  If

(a) an administrator of a credit union that is subject to the supervision of the commission has been appointed under section 277 (e) of the Financial Institutions Act, and

(b) the commission, under section 277 (g) of the Financial Institutions Act, orders the credit union (the "transferring credit union") to dispose of all of its assets, or part of its assets that constitutes substantially all of its assets, to another credit union ("the acquiring credit union"),

then, for the purpose of carrying out the order by means of an asset transfer agreement under section 16, the administrator has the powers and duties of the transferring credit union, and

(c) the administrator, together with the acquiring credit union, may propose and submit to the commission the asset transfer agreement as required under section 16 (2), and

(d) subject to receiving the consent of the commission under section 16 (3), the transferring credit union, through its administrator, may enter into the proposed asset transfer agreement, which, when executed by the transferring credit union and the acquiring credit union, must be delivered to the commission for the appropriate action under section 16 (7).

(2)  For the purposes of a disposition of all or part of a credit union's assets and liabilities ordered by the commission under section 277 (g) of the Financial Institutions Act, the approval of the credit union's members and auxiliary members to the disposition is not required, despite anything in the credit union's constitution and rules.

Vesting in the acquiring credit union

18  On and after the effective date put in a certificate of business acquisition issued under section 16 (8) (b),

(a) the rights, property and assets of the transferring credit union are transferred to and vested in the acquiring credit union,

(b) the obligations and liabilities of the transferring credit union, including any obligations to members and auxiliary members under section 24,

(i)  are transferred to and assumed by the acquiring credit union,

(ii)  become the obligations and liabilities of the acquiring credit union, and

(iii)  become enforceable against the acquiring credit union as if it had incurred them,

(c) each member and auxiliary member of the transferring credit union and of the acquiring credit union is bound by the asset transfer agreement, and

(d) each member of the transferring credit union becomes a member of the acquiring credit union and remains one until the member's membership ceases in accordance with section 45, 47, 48 or 49, or the rules of the acquiring credit union.

Dissolution of transferring credit union

19  On the effective date put in a certificate of business acquisition issued under section 16 (8) (b), the registrar must strike the transferring credit union off the register and, on the registrar doing that, the transferring credit union is dissolved.

Amalgamation

20  (1)  Two or more credit unions (the "amalgamating credit unions") may amalgamate and continue as one credit union (the "amalgamated credit union"), but must not do so except in accordance with this section.

(2)  Amalgamating credit unions, including any ordered under section 277 (g) of the Financial Institutions Act to amalgamate, together must propose and submit to the commission an amalgamation agreement that

(a) specifies

(i)  the name of the proposed amalgamated credit union,

(ii)  the terms and conditions of the amalgamation,

(iii)  the manner of carrying the amalgamation into effect,

(iv)  the names and addresses of the individuals proposed as the directors and senior officers of the proposed amalgamated credit union,

(v)  whether the business proposed to be carried on by the proposed amalgamated credit union is deposit business or both deposit business and trust business,

(vi)  the services that the proposed amalgamated credit union intends to offer to its members,

(vii)  the common bond of membership of the proposed amalgamated credit union,

(viii)  the manner in which the issued and unissued shares of each amalgamating credit union will be exchanged for those of the amalgamated credit union, and

(ix)  the fair market value of the equity shares of any class, or a method of determining the fair market value of the equity shares of any class, for the purpose of section 24, and

(b) contains

(i)  the constitution prepared in accordance with section 6, and

(ii)  the rules prepared in accordance with section 7,

that are proposed as the constitution and rules of the amalgamated credit union.

(3)  On receiving a proposed amalgamation agreement submitted to the commission, including one where one or more of the amalgamating credit unions is acting under section 21 through an administrator,

(a) the commission may consent to the proposed amalgamation agreement, or

(b) if the commission considers that the proposed amalgamation agreement is contrary to the interests of one or more of the amalgamating credit unions or its or their members, the commission may refuse to consent to it.

(4)  If the commission consents under subsection (3) to a proposed amalgamation agreement under which any of the proposed amalgamating credit unions is one that is not acting under section 21 through an administrator, then this subsection applies to that amalgamating credit union, and it must

(a) submit the proposed amalgamation agreement to its members for approval by special resolution, if it is a credit union that has issued no equity shares or has issued no equity shares other than the membership shares, or

(b) submit the proposed amalgamation agreement

(i)  to its members for approval by special resolution, and

(ii)  to the holders of each class of equity shares other than the membership shares for approval by a separate resolution of the holders of that class, requiring a majority of 2/3 of the votes cast,

if it is a credit union that has issued 2 or more classes of equity shares.

(5)  If an amalgamating credit union to which subsection (4) applies has provided in its rules as set out in section 58 (2) respecting rights or special rights attached to its issued equity shares, then, on a separate resolution required under subsection (4) (b) (ii), each holder of equity shares has one vote in respect of each share held by that holder.

(6)  If the members or the members and other equity shareholders, as the case may be, of an amalgamating credit union to which subsection (4) applies have approved the proposed amalgamation agreement in compliance with subsections (4) and (5), that amalgamating credit union may enter into the proposed amalgamation agreement, which, when executed by each of the amalgamating credit unions, including any of them acting under section 21 through an administrator, must be delivered to the registrar together with a certified copy of each of any resolutions required in respect of an amalgamating credit union to which subsection (4) applies.

(7)  On receiving the executed amalgamation agreement, or the executed amalgamation agreement and a certified copy of each of any resolutions, delivered under subsection (6), the registrar must

(a) register the agreement or the agreement and a certified copy of each resolution, as the case may be,

(b) issue a certificate of amalgamation showing that the amalgamating credit unions are amalgamated and the date of the amalgamation, which must not be earlier than the date the documents are received by the registrar, and

(c) publish in the Gazette a notice of the amalgamation showing the names of the amalgamating credit unions, the name of the amalgamated credit union, the address of its registered office and the date of the amalgamation.

Amalgamation directed by commission

21  (1)  If,

(a) an administrator of a credit union that is subject to the supervision of the commission has been appointed under section 277 (e) of the Financial Institutions Act, and

(b) the commission, under section 277 (g) of the Financial Institutions Act, orders the credit union (the "credit union ordered to amalgamate") to amalgamate with one or more other credit unions,

then, for the purpose of carrying out the order by means of an amalgamation agreement under section 20, the administrator has the powers and duties of the credit union ordered to amalgamate, and

(c) the administrator, together with the other amalgamating credit unions, may propose and submit to the commission the amalgamation agreement required under section 20 (2), and

(d) subject to receiving the consent of the commission under section 20 (3), the credit union ordered to amalgamate may enter into the proposed amalgamation agreement through its administrator, and, when executed by each of the amalgamating credit unions, the agreement must be delivered to the registrar in accordance with section 20 (6).

(2)  For the purposes of an amalgamation ordered by the commission under section 277 (g) of the Financial Institutions Act, the approval of the members or auxiliary members of the credit union ordered to amalgamate to the amalgamation is not required, despite anything in the constitution and rules of the credit union ordered to amalgamate.

No interruption in business on amalgamation

22  On an amalgamation under section 20, the amalgamated credit union

(a) may carry on business under the business authorization issued with respect to one of the amalgamating credit unions, as the commission may direct, until the amalgamated credit union has been granted a new business authorization under section 61 of the Financial Institutions Act, and

(b) has 30 days in which to apply under section 61 (4) of the Financial Institutions Act for a new business authorization.

Vesting on amalgamation

23  On and after the date of the amalgamation shown in a certificate of amalgamation issued under section 20 (7) (b),

(a) the amalgamating credit unions are amalgamated and are continued as one credit union under the name and with the constitution and rules provided in the amalgamation agreement,

(b) the amalgamated credit union is seized of and holds and possesses all the property, rights and interests and is subject to all the debts, liabilities and obligations of each amalgamating credit union, including any obligations to members or auxiliary members under section 24, and

(c) every member and auxiliary member of each amalgamating credit union is bound by the amalgamation agreement.

Right to redeem equity shares on business acquisition or amalgamation

24  (1)  If

(a) a transferring credit union, including one acting under section 17 through an administrator, enters into an asset transfer agreement under section 16, or

(b) an amalgamating credit union, including one acting under section 21 through an administrator, enters into an amalgamation agreement under section 20,

the transferring credit union or amalgamating credit union, as the case may be, must deliver immediately to

(c) each member holding equity shares in the transferring credit union or amalgamating credit union, other than membership shares, and

(d) each auxiliary member, if any, of the transferring credit union or amalgamating credit union

a notice advising the member or auxiliary member of the rights under this section of the member or auxiliary member.

(2)  On receiving the notice under subsection (1), the member or auxiliary member is entitled to require that the acquiring credit union or amalgamating credit union, as the case may be, purchase all of the member's or auxiliary member's equity shares.

(3)  In order to exercise the right conferred by subsection (2), the member or auxiliary member must deliver to the registered office of the acquiring credit union or the amalgamating credit union, as the case may be, within 14 days after the date of the notice under subsection (1), a notice requiring the acquiring credit union or amalgamating credit union to purchase all of the member's or auxiliary member's equity shares.

(4)  If a member or auxiliary member exercises the right conferred by subsection (2) in accordance with subsection (3), the member or auxiliary member is obliged to sell all of the member's or auxiliary member's equity shares to the acquiring credit union or the amalgamating credit union, and the credit union is obliged to purchase them, at the fair market value determined under the asset transfer agreement entered into under section 16 or the amalgamation agreement entered into under section 20, as the case may be.

(5)  A member or auxiliary member who exercises the member's or auxiliary member's right under subsection (2)

(a) must not withdraw the requirement to purchase the equity shares, unless the credit union consents to the withdrawal, and

(b) until paid in full, may exercise and assert all the rights of a creditor of the credit union.

(6)  If a member or auxiliary member exercises the member's or auxiliary member's right under subsection (2) but the credit union is prohibited under section 64 (8) from purchasing equity shares issued by the credit union, the credit union remains obligated under this section to purchase the member's or auxiliary member's equity shares and must purchase them as soon as no longer prohibited from doing so under section 64 (8).

(7)  A credit union may apply the purchase price for equity shares it must purchase under this section, and any declared but unpaid dividends on those equity shares, in satisfaction of indebtedness owed to the credit union by the person to whom the purchase price and dividends are due, and then the credit union must pay any balance to the person.

(8)  A credit union must not exercise its right under subsection (7) in respect of jointly held equity shares or dividends on them

(a) except with the consent of each of the joint holders, or

(b) unless each of the joint holders is indebted to the credit union.

Winding up

25  (1)  A special resolution under section 267 of the Company Act as it applies for the purposes of this Act has no effect unless 30 days' notice in writing of the credit union's intention to pass the resolution has been given to the commission.

(2)  The commission is party to any proceedings in which an application is made to the Supreme Court under section 271 of the Company Act as it applies for the purposes of this Act.

Winding up directed by commission

26  If, under section 277 (g) of the Financial Institutions Act, the commission orders that a credit union that is subject to the commission's supervision be wound up, then,

(a) despite section 3 (e) of this Act, sections 267 to 269 and 283 of the Company Act do not apply,

(b) the winding up commences at the time of the order that the credit union be wound up,

(c) the commission must promptly appoint one or more liquidators, who may be the commission's own employee or employees, for the purpose of winding up the affairs and distributing the assets of the credit union,

(d) the commission must promptly file with the registrar a copy of the order and notify the registrar of the appointment under paragraph (c) of one or more liquidators, and

(e) the commission must promptly publish in the Gazette notice of its order that the credit union be wound up.

Appointment of liquidator

27  (1)  If a credit union passes a special resolution to wind up voluntarily under section 267 of the Company Act as it applies for the purposes of this Act, the credit union must promptly deliver written notice of the special resolution to the commission.

(2)  On receiving notice under subsection (1), the commission must appoint one or more liquidators, who may be the commission's own employee or employees, for the purpose of winding up the affairs and distributing the assets of the credit union.

Remuneration of liquidator

28  The remuneration of a liquidator in a voluntary winding up of a credit union or a winding up of a credit union ordered under section 277 (g) of the Financial Institutions Act must be set by the commission.

Resignation and removal of liquidator

29  (1)  A liquidator appointed in a voluntary winding up of a credit union or a winding up of a credit union ordered under section 277 (g) of the Financial Institutions Act may resign from that office.

(2)  If, in the opinion of the commission,

(a) a voluntary winding up of a credit union, or

(b) a winding up of a credit union ordered under section 277 (g) of the Financial Institutions Act

is being carried on in an unsafe or unauthorized manner or is being unduly delayed, the commission, by notice addressed to the liquidator, may remove the liquidator from office.

(3)  If a vacancy occurs by death, resignation or otherwise in the office of liquidator in

(a) a voluntary winding up of a credit union, or

(b) a winding up of a credit union ordered under section 277 (g) of the Financial Institutions Act

the commission must appoint a liquidator to fill the vacancy.

Powers of liquidator

30  (1)  In consideration of financial assistance by the deposit insurance corporation to the credit union, a liquidator of a credit union may transfer and assign all or any assets of the credit union to the deposit insurance corporation.

(2)  Despite section 289 (1) and (3) of the Company Act as it applies for the purposes of this Act, a liquidator of a credit union must not sell all or substantially all of the assets of the credit union to another credit union except in compliance with section 16 of this Act.

Satisfaction of liabilities on winding up

31  If a credit union is being wound up, any property of the credit union remaining after satisfaction of all liabilities of the credit union, including the costs of winding up and dissolution, is surplus property and must be dealt with in accordance with sections 32 and 33.

Distribution of surplus if credit union has not issued equity shares

32  If the credit union being wound up has not issued any equity shares, the liquidator must apply the surplus property as follows:

(a) by declaring and paying a dividend, at a reasonable rate determined by the liquidator, on the non-equity shares in respect of the period from the beginning of the credit union's current fiscal year to the date of commencement of the winding up;

(b) after payment of the dividend under paragraph (a), by paying or delivering the balance to the deposit insurance corporation.

Distribution of surplus if credit union has issued equity shares

33  If the credit union being wound up has issued equity shares, the liquidator must convert into money any surplus property that is not money, and then must apply the money as follows:

(a) by declaring and paying a dividend, at a reasonable rate determined by the liquidator, on the non-equity shares in respect of the period from the beginning of the credit union's current fiscal year to the date of commencement of the winding up;

(b) after payment of the dividend under paragraph (a), by distributing the balance to the equity shareholders according to their rights and interests in the credit union.

Members' or auxiliary members' indebtedness to credit union

34  The liquidator of a credit union may apply the amount of a dividend under section 32 (a) or of a dividend or distribution under section 33 in satisfaction of indebtedness owed to the credit union by the member or auxiliary member to whom the amount is due, and then the credit union must pay any balance to the member or auxiliary member.

Unclaimed or undistributed assets

35  (1)  In this section, "administrator" has the same meaning as in the Unclaimed Property Act.

(1.1)  If a liquidator has or controls any unclaimed or undistributed assets or money of a credit union that is being wound up and the assets or money have remained unclaimed or undistributed for more than 6 months after the date on which any dividend, or other distribution of assets or money, declared by the liquidator became payable or distributable, the liquidator must publish in one or more newspapers selected by the liquidator a statement of

(a) the assets or money unclaimed or undistributed,

(b) the procedure required to claim the assets or money, and

(c) the date, not sooner than 60 days after or later than 120 days after the publication, on which date the liquidator will deliver or pay

(i)  to the deposit insurance corporation any part of the assets or money apparently due to, but unclaimed by, members of the credit union, or

(ii)  to the administrator any part of the assets or money apparently due to, but unclaimed by, auxiliary members or creditors of the credit union or other non-members of the credit union.

(2)  On the date published under subsection (1.1) (c), the liquidator must deliver or pay

(a) to the deposit insurance corporation any part of the assets or money apparently due to, but unclaimed by, members of the credit union, or

(b) to the administrator any part of the assets or money apparently due to, but unclaimed by, auxiliary members or creditors of the credit union or other non-members of the credit union,

together with a statement showing, to the extent known to the liquidator, the full names and last known addresses of the persons appearing to be entitled to the assets or money and the amount to which each appears to be entitled.

(3)  The receipt of the deposit insurance corporation for the assets or money referred to in subsection (2) (a) or of the administrator for the assets or money referred to in subsection (2) (b) is an effective discharge to the liquidator for them.

(4)  The administrator, in respect of assets paid or delivered to the administrator under this section, may realize any assets, and any money received or realized under this section is deemed to be unclaimed money deposits under the Unclaimed Property Act.

(5)  If

(a) the deposit insurance corporation, under subsection (2) (a), has received assets or money unclaimed by members of a credit union,

(b) application is made to the deposit insurance corporation by or on behalf of a former member of the credit union, and

(c) the deposit insurance corporation is satisfied that the former member was entitled to but did not receive

(i)  a dividend declared under section 32 (a) or 33 (a) on non-equity shares in the credit union, or

(ii)  a share of a distribution made under section 33 (b),

the deposit insurance corporation must pay to that former member the amount of the dividend or share of the distribution, together with accrued interest at a reasonable rate determined by the deposit insurance corporation.

Additional powers of Supreme Court

36  The Supreme Court's powers, under section 290 of the Company Act as it applies for the purposes of this Act, in respect of the winding up of credit unions, include the power to extend any time limited by this Act or an applicable provision of the Company Act for the filing or publishing of notices, accounts, reports or documents or for the holding of any meeting.

Notice on dissolution

37  In addition to fulfilling the requirements of section 292 (1), (2) and (4) of the Company Act as it applies for the purposes of this Act, the liquidator of a credit union,

(a) not more than 14 days after the date of the final general meeting required under section 292 (1) of the Company Act as it applies for the purposes of this Act, must publish in one or more newspapers selected by the liquidator a notice that the affairs of the credit union have been wound up, and

(b) must file with the commission a copy of the account showing how the winding up has been conducted and how the property of the credit union has been disposed of, together with a copy of the newspaper notice.

Winding up on direction of commission

38  (1)  If the commission believes on reasonable grounds that it is contrary to the public interest that a credit union that has not been issued a business authorization continue in business, the commission may order that the credit union be wound up.

(2)  Without limiting subsection (1), if a credit union

(a) has fewer than 25 members,

(b) has contravened section 13,

(c) has not applied for a business authorization within one year or the further period ordered by the commission under section 61 (2) of the Financial Institutions Act after the date of its incorporation, or

(d) is refused a business authorization,

the commission may order that the credit union be wound up.

(3)  If the commission makes an order under this section, the references in sections 273, 274, 275 (2) (b), 278 (b), 279 (1) (a), 283 (1) (b) and (3), 286 (1), 288 (3) and 293 (3) of the Company Act as those sections apply for the purposes of this Act to the court or a court order must be read for the purposes of the winding up ordered by the commission as references to the commission or to a commission order.

(4)  On the winding up of a credit union under this section, the registrar must publish in the Gazette notice that the credit union is being wound up and the date of the winding up order.

(5)  The cost of the publication under subsection (4) must be paid by the credit union to the government and is recoverable by the government from the credit union as a simple contract debt.

Examination of credit union winding up

39  The commission may at any time examine the records of a credit union that is being wound up.

Common bond

40  (1)  A credit union must have a common bond of membership based on only one of the following: religious interest; ethnic interest; social interest; occupation; employment; community; geographic area.

(2)  Subject to first receiving written approval of the commission and subject also to continued compliance with subsection (1), a credit union may amend its common bond of membership by special resolution.

(3)  For the purpose of accommodating an amalgamation under section 20 or 21, or a sale and purchase of assets under section 16 or 17, despite subsection (1) but subject to first receiving the written approval of the commission, a credit union may

(a) have for its common bond of membership more than one basis set out in subsection (1), and

(b) by special resolution amend its common bond of membership for that purpose.

(4)  A credit union must file with the registrar every special resolution amending its common bond of membership.

Membership qualifications

41  (1)  A credit union may admit as a member only those persons who are eligible under subsection (2), (3), (4), (5) or (6).

(2)  A person who meets all of the following requirements is eligible to be a member of a credit union:

(a) the person is one of a group that the credit union under its common bond of membership is intended to serve;

(b) the person applies for membership and the application is approved by the directors, a committee of the directors or a nominee of the directors;

(c) the person subscribes and pays for at least the minimum number of membership shares required under the rules of the credit union.

(3)  If a person is one of a group that a credit union under its common bond of membership is intended to serve

(a) that person's spouse, parent or child, or

(b) that person's

(i)  relative, or

(ii)  spouse's relative

who occupies the same home as that person

is eligible to be a member of the credit union, subject to meeting the requirements set out in subsection (2) (b) and (c).

(4)  If the directors of a credit union consider that a person may be conveniently served by it, the person is eligible to be a member of the credit union, subject to meeting the requirements set out in subsection (2) (b) and (c).

(5)  An employee of a credit union is eligible to be a member of the credit union, subject to any restrictions on employee membership under the rules and subject to meeting the requirements set out in subsection (2) (b) and (c).

(6)  Each of the following is eligible to be a member of a credit union, if it meets the requirements set out in subsection (2) (b) and (c):

(a) the government;

(b) a public body;

(c) a subsidiary of the credit union.

Junior members

42  (1)  Despite section 41, an individual under 19 years of age who meets the requirements of section 41 (2), (3), (4) or (5) may be admitted only as a junior member of the credit union.

(2)  Despite the Infants Act, the Age of Majority Act or the common law, but subject to subsection (3), in respect of membership in the credit union and of any indebtedness or obligation to the credit union, a junior member of a credit union

(a) has the same obligations, rights and legal capacity as a member of the credit union who has reached 19 years of age, and

(b) may be sued.

(3)  A junior member is not entitled to vote, be a director or be a member of a committee of the credit union.

(4)  A junior member becomes a member with full membership rights and obligations on reaching 19 years of age.

Ceasing to be a member

43  A member of a credit union does not cease to be a member except as provided in sections 45, 47, 48 and 49.

Membership shares

44  (1)  The rules of a credit union must provide, as a condition of admission as a member of the credit union, that each member subscribe and pay for a specified minimum number, not less than 5, of shares of a distinct class of equity shares having a par value of $1 for each share.

(2)  If the rules of a credit union provide as set out in subsection (1), the shares of the distinct class of equity shares referred to in that subsection are the membership shares in the credit union.

(3)  If the rules of a credit union do not provide as set out in subsection (1), the rules of the credit union are deemed to be amended to contain the following:

"A distinct class of equity shares of the credit union is established consisting of an unlimited number of equity shares having a par value of $1 each. As a condition of admission as a member or as a junior member a person is required to subscribe and pay for at least 5 membership shares."

and the shares of that distinct class of equity shares are the membership shares in that credit union.

(4)  The membership shares in a credit union are redeemable as set out in section 64 (6) to (8).

(5)  A membership share in a credit union

(a) must not be beneficially owned by, and

(b) is not assignable to

a person who is not a member of the credit union.

(6)  A credit union must not

(a) issue its membership shares, or

(b) enter in its register of members and auxiliary members a transfer of membership shares

to any person who

(c) is not a member of the credit union, or

(d) will not become a member on the issue or transfer of the shares.

(7)  A member of a credit union may not subscribe and pay for more than the maximum number of membership shares in the credit union specified in the rules of the credit union, which maximum number must be not greater than 1 000, and if in the rules of a credit union no such maximum number is specified, a member may not subscribe and pay for more than 1 000 membership shares in that credit union.

(8)  A credit union must not attach rights or restrictions to its membership shares under its rules unless the rights or restrictions

(a) are consistent with the requirements of this section, and

(b) have first received the consent of the commission.

(9)  If there is a conflict between this section and the constitution or rules of a credit union respecting membership shares, this section prevails.

(10)  To the extent that rights or restrictions attached to membership shares in a credit union under the rules of the credit union are inconsistent with this section, the rules are ineffective and the rights or restrictions are unenforceable.

Membership ceases for failure to hold membership shares

45  (1)  It is a condition of membership in every credit union that each member hold at least the minimum number of membership shares specified under the rules of the credit union.

(2)  A member of a credit union who ceases to hold at least the minimum number of membership shares specified under the rules of the credit union immediately ceases to be a member of the credit union.

Auxiliary membership

46  (1)  A person who holds equity shares in a credit union but is not a member of it is an auxiliary member of the credit union.

(2)  A person who holds shares of any class of equity shares of a credit union, other than membership shares, becomes an auxiliary member of the credit union immediately on ceasing to be a member of the credit union

(a) under section 45 (2),

(b) on withdrawal from membership under section 47, or

(c) on termination of membership under section 48 or 49.

Withdrawal from membership

47  A member may withdraw from membership in a credit union by giving written notice of withdrawal to the credit union.

Termination of membership

48  (1)  In this section, "stabilization authority" means the central credit union designated as the stabilization authority under section 282 of the Financial Institutions Act.

(2)  The only way by which the directors of a credit union, other than the stabilization authority, may terminate a person's membership in the credit union is by resolution of the directors,

(a) requiring a majority of 3/4 of all the directors, and

(b) passed at a meeting of the directors.

(3)  The only way by which the directors of the stabilization authority may terminate a person's membership in the stabilization authority is by resolution of the directors,

(a) requiring approval by all the directors, and

(b) passed at a meeting of the directors.

(4)  A person whose membership is proposed to be terminated by a resolution of the directors is entitled to at least 7 days' notice of the meeting at which the resolution is to be considered, together with a statement of the grounds for termination, and the person may appear, either personally or by or with an agent or counsel, to make submissions at the meeting.

(5)  Within 7 days after the date on which the resolution referred to in subsection (2) or (3) is passed by the required majority, the credit union must give written notice of the resolution to the person whose membership is terminated.

(6)  A person whose membership is terminated under subsection (2) or (3) may appeal the decision of the directors at the next general meeting of the credit union by delivering a written notice of appeal to the credit union within 7 days after receiving notice under subsection (5).

(7)  A person who, within the time limited by subsection (6), appeals the termination of the person's membership, despite the resolution of the directors terminating the membership, continues to be a member of the credit union unless the members at the general meeting to which the appeal is brought confirm the termination of the person's membership by a resolution requiring a simple majority or, if provided by the rules, a greater majority.

Termination of membership by special resolution

49  The only way by which the members of a credit union may terminate a person's membership in the credit union is by special resolution, passed at a general meeting at which the person is given an opportunity to be heard.

Readmission requires special resolution

50  A person whose membership has been terminated in accordance with section 48 or 49 must not again be admitted to membership in the credit union unless the readmission is approved by special resolution.

Restrictions respecting auxiliary membership

51  Subject to sections 16 (4) (b) (ii), 20 (4) (b) (ii) and 58, an auxiliary member of a credit union is not entitled to vote, be a director or be a member of a committee of the credit union.

Entitlement to refund

52  (1)  If a person ceases to be a member of a credit union

(a) under section 45 (2),

(b) on withdrawal from membership under section 47, or

(c) on termination of membership under section 48 or 49,

then, subject to section 64 (6), (7) and (8) and to subsection (2) of this section, the credit union

(d) must redeem or purchase at par value any membership shares held by that person and pay that person any declared but unpaid dividends on those shares,

(e) must pay that person the amount paid up on that person's non-equity shares, if any, and any declared but unpaid dividends on those non-equity shares, and

(f) subject to completion of the term of any term deposit, must pay that person any amount that person has on deposit in the credit union and any accrued interest on that money.

(2)  A credit union may apply an amount due by it under subsection (1) (e) or (f) in satisfaction of indebtedness owed to the credit union by the person to whom the amount is due, and then the credit union must pay any balance to the person.

(3)  A credit union must not exercise its right under subsection (2) in respect of jointly held non-equity shares or deposits, or interest or dividends on them,

(a) except with the consent of each of the joint holders, or

(b) unless each of the joint holders is indebted to the credit union.

Loss of office

53  On ceasing to be a member of a credit union, a person ceases to hold any position as a director or member of a committee of the credit union.

Register of members and auxiliary members

54  (1)  A credit union must keep all of the following:

(a) a record showing the name and address of each member and auxiliary member;

(b) the date on which each person was entered in the register as a member or auxiliary member and whether any equity shares of the member or auxiliary member were acquired by allotment, transfer, conversion, exchange or otherwise, and, if by transfer, from whom;

(c) the date on which a person ceased to be a member or auxiliary member;

(d) the kind and class of shares held by each member or auxiliary member, the par value, if any, of the shares and, in the case of partly paid shares, the amount paid or agreed to be considered as paid on each share;

(e) identifying particulars of the share certificates issued for the shares held by each member or auxiliary member.

(2)  The record required to be kept under subsection (1) (a) constitutes the register of members and auxiliary members and their addresses for the purpose of giving notice and for other purposes as may be required by the rules of the credit union.

Shares

55  (1)  Subject to its constitution and rules, a credit union may issue an unlimited number of shares.

(2)  In its constitution or rules, a credit union may provide for one or more classes of shares, with or without par value, with differing rights and restrictions among classes.

(3)  A credit union must not allot or issue fractional shares.

Creation of special rights and restrictions

56  Subject to sections 58 and 59, a credit union may alter its constitution or rules by special resolution in order to create, define and attach special rights or restrictions to equity shares of any class in the credit union, whether those shares are issued or unissued.

Alteration or abrogation

57  Subject to sections 58 and 59 and otherwise complying with the rules, a credit union may alter its constitution or rules by special resolution in order to alter or abrogate any special rights or restrictions attached to equity shares of any class in the credit union, whether those shares are issued or unissued.

No interference with class rights without consent

58  (1)  Rights or special rights attached to issued equity shares of any class in a credit union must not be prejudiced or interfered with under this Act, except as provided in section 44 (3) or in the constitution and rules, unless the holders of that class of equity shares so approve by a separate resolution requiring a majority of 2/3 of the votes cast.

(2)  A credit union may provide in its rules that, for the purpose of a separate resolution under subsection (1) of the holders of a class of equity shares, each holder has one vote in respect of each share held by that holder.

Dissenter's right to apply to Supreme Court

59  (1)  Members or auxiliary members of a credit union,

(a) being not fewer than 10% of the members entitled to vote who did vote against the special resolution referred to in section 56 or 57,

(b) if the credit union's rules do not provide as set out in section 58 (2), being not fewer than 10% of the members and auxiliary members holding shares of a class of shares of the credit union whose special rights or restrictions are affected by a special resolution altering or abrogating special rights or restrictions attaching to that class of shares, or

(c) if the credit union's rules do provide as set out in section 58 (2), being the holders of not less than 10% of the shares of a class of shares of the credit union whose special rights or restrictions are affected by a special resolution altering or abrogating special rights or restrictions attaching to that class of shares,

not more than 14 days after the passing of

(d) the special resolution referred to in section 56 or 57, or

(e) the separate resolution referred to in section 58,

whichever is the later, may apply to the Supreme Court to set aside the special resolution referred to in section 56 or 57 or the separate resolution referred to in section 58.

(2)  The Supreme Court must not hear an application under subsection (1) unless

(a) notice has been served on the credit union, and

(b) an affidavit of that service exhibiting the notice has been served on the registrar and on the superintendent

not later than 14 days after the passing of the later resolution.

(3)  The Supreme Court may direct that notice of the application under subsection (1) be served on any other person.

(4)  On an application under subsection (1), the Supreme Court may

(a) set aside the special resolution and require a copy of the order setting it aside to be filed with the registrar and the superintendent,

(b) affirm the special resolution subject to terms the Supreme Court considers appropriate, or

(c) affirm the special resolution and require the credit union, subject to section 64 (8), or any other person to purchase the shares of any member or auxiliary member at a price and on the terms to be determined by the Supreme Court,

and, in any case, the Supreme Court may make consequential orders, including any order as to costs, and may give directions it considers appropriate.

Entitlement to share certificate

60  (1)  A credit union must issue share certificates evidencing equity shares other than membership shares.

(2)  Within one month after allotment of equity shares other than membership shares, a credit union must issue and deliver, without charge to each person who after September 15, 1990 subscribes and pays for the equity shares, a share certificate for them.

(3)  A share certificate issued by a credit union for equity shares must conspicuously state the following on its face:

"NOT GUARANTEED BY THE CREDIT UNION DEPOSIT INSURANCE CORPORATION".

(4)  In respect of equity shares issued before September 15, 1990, for which no share certificates have been issued, the credit union, on each accounting of those equity shares, must disclose in writing to each member or auxiliary member who holds equity shares that

(a) money invested in equity shares is not guaranteed by the deposit insurance corporation, and

(b) on written application to the credit union, the member or auxiliary member is entitled without charge to a share certificate for the equity shares other than membership shares held by the member or auxiliary member.

Particulars of issue on share certificates

61  (1)  If a credit union has more than one class of equity shares, the credit union must ensure that

(a) the full text of the special rights or restrictions attached to any class of equity shares is contained in or attached to each share certificate representing that class, or

(b) each share certificate representing any class of equity shares has a statement on it indicating that

(i)  there are special rights or restrictions attached to that class, and

(ii)  a free copy of the full text of the special rights or restrictions may be obtained at the records office of the credit union.

(2)  A credit union must

(a) keep at its records office a copy of the full text of the special rights or restrictions attached to any class of equity shares, and

(b) provide a free copy of that text to any person who requests one.

Security issue preconditions

62  (1)  Nothing in this section or section 66 limits the application of the Securities Act or the Real Estate Development Marketing Act.

(2)  Subject to subsection (3), a credit union must not issue equity shares or other security instruments until at least 14 days after it has filed with the superintendent

(a) a disclosure statement that is in the prescribed form and that complies with subsection (4), and

(b) any other type of document that is prescribed.

(3)  Subsection (2) does not apply

(a) in respect of the membership shares of a credit union, or

(b) in circumstances or on conditions that may be prescribed in respect of

(i)  a prescribed type of equity share that is not a membership share, or

(ii)  a prescribed type of other security instrument

issued by credit unions generally or by a particular credit union.

(4)  A disclosure statement required under subsection (2) must

(a) provide full, true and plain disclosure of all material facts relating to the equity shares or other security instruments to be issued,

(b) comply as to form and content with the requirements of this Act and the regulations, and

(c) have printed or stamped in conspicuous type on its outside front cover the following words:

"Neither the Superintendent of Financial Institutions nor any other authority of the government of the Province of British Columbia has in any way passed on the merits of the matters dealt with in this disclosure statement."

(5)  If there is a material change in the facts set out in a disclosure statement required under subsection (2), the credit union, within 30 days after that change, must file with the superintendent a statement of material change describing that change.

(6)  A credit union may file, and if ordered to do so by the superintendent must file, with the superintendent a revised disclosure statement

(a) describing every material change since the filing of the disclosure statement, and

(b) replacing any previous statement of material change since that filing.

(7)  A copy of a disclosure statement filed under subsection (2), together with any relevant statement of material change, must be open to inspection by any person during normal business hours at the records office of the credit union.

Disclosure to person acquiring securities

63  Before an equity share or other security instrument, for which a disclosure statement under section 62 (2) is required, is issued to a person acquiring the equity share or security instrument from the credit union, and before that person has become obliged to acquire the equity share or security instrument, the credit union must deliver to that person a true copy of the disclosure statement and any relevant statement of material change.

Transfer, redemption and purchase of shares

64  (1)  This section does not apply to a central credit union.

(2)  Subject to section 44 (5) to (7), in respect of a membership share, an equity share in a credit union is transferable in accordance with the rules of the credit union.

(3)  A transfer of equity shares is effective only on registration of the transfer by the credit union.

(4)  Subject to subsections (7) and (8) and the rules of the credit union, a credit union by resolution of its directors may redeem or purchase any of its issued equity shares.

(5)  A redemption or purchase of membership shares that is required by section 52 (1) (d) must be carried out in accordance with section 52, despite the rules of the credit union, and without the necessity of a resolution of the directors.

(6)  If a credit union redeems or purchases a person's equity shares, the credit union may apply the amount due by it on redemption or purchase, including declared but unpaid dividends on those equity shares, in satisfaction of indebtedness owed to the credit union by the person, and then the credit union must pay any balance to the person.

(7)  A credit union must not exercise its right under subsection (6) in respect of jointly held equity shares or dividends on them

(a) except with the consent of each of the joint holders, or

(b) unless each of the joint holders is indebted to the credit union.

(8)  Without first receiving the written approval of the commission, a credit union must not redeem or purchase or otherwise acquire equity shares issued by the credit union if the redemption, purchase or other acquisition would reduce the credit union's capital base to an amount less than the amount that constitutes an adequate capital base for that credit union in accordance with the regulations under section 289 (3) (f) of the Financial Institutions Act.

dividends on shares

65  (1)  Subject to subsection (3), the directors of a credit union may declare dividends on any class of shares, and, if they do so, the credit union must pay the dividends as declared.

(2)  The discretion to declare dividends under subsection (1) on equity shares includes the discretion to declare dividends by way of the issue by the credit union of fully paid equity shares of the same class as those on which the dividends are declared.

(3)  A credit union must not declare or pay dividends on any class of equity shares

(a) except in proportion to the amount paid up on the shares, and

(b) subject to subsection (4), if the payment of the dividend would reduce the credit union's capital base to an amount less than the amount that constitutes an adequate capital base for that credit union in accordance with the regulations under section 289 (3) (f) of the Financial Institutions Act.

(4)  On application by a credit union made in respect of a proposed declaration and payment of dividends, the commission may order that, in respect of the proposed declaration and payment of dividends, the credit union is exempt from compliance with subsection (3) (b).

Discharge of credit union

66  In the absence of written notice to the credit union to the contrary

(a) from a member, auxiliary member or depositor, as the case may be, or

(b) from a joint owner of a member's, auxiliary member's or depositor's share or deposit, or from the survivor of 2 or more joint owners,

payment by the credit union, to or to the order of the member, auxiliary member, depositor, joint owner or survivor, of money invested in shares or on deposit, discharges the credit union from any further liability, and the credit union is not obliged to see to the application of money so paid.

Shares in trust

67  Unless the instrument of trust permits, shares of and deposits with a credit union held by a trustee in trust for a named beneficiary, or otherwise, must not be charged to secure a loan or obligation.

Financial assistance for equity shares

68  A credit union must not knowingly give financial assistance to a member or auxiliary member directly or indirectly by way of loan, guarantee or the provision of security, or otherwise, for the purpose of

(a) a purchase of, or a subscription made or to be made by that member or auxiliary member for, or the acquisition of any right which may be converted to, equity shares of the credit union, or

(b) the acquisition of any debt obligations of the credit union with a right of conversion into or exchange for equity shares of the credit union.

Patronage allocations

69  (1)  Subject to subsection (2), a credit union may pay an allocation to a person

(a) in respect of the person's borrowing from the credit union in the year, on the terms to which the person is entitled or on which the person will receive payment of the allocation, computed at a rate or rates in relation to

(i)  the amount of interest payable by the person on the money borrowed, or

(ii)  the amount of money borrowed by the person,

(b) in respect of the person's money on deposit with the credit union in the year, on the terms to which the person is entitled or on which the person will receive payment of the allocation, computed at a rate or rates in relation to

(i)  the amount of interest payable by the credit union to the person on the money on deposit, or

(ii)  the amount of money on deposit to the credit of the person, and

(c) in respect of goods or services provided to the person in the year, computed at a rate or rates in relation to

(i)  the quantity, quality or value or the goods or services provided by or to the person, or

(ii)  the fees paid by the person for goods or services.

(2)  Unless it first receives the approval of the commission, a credit union must not pay allocations under subsection (1) that would reduce the credit union's capital base to an amount less than the amount that constitutes an adequate capital base for that credit union in accordance with the regulations under section 289 (3) (f) of the Financial Institutions Act.

Voting

70  (1)  No member of a credit union has more than one vote on a resolution or in an election of directors and no auxiliary member of a credit union has more than one vote on a separate resolution, except

(a) in accordance with rules that allow the chair of the meeting to have a deciding or second vote in the event of a tie vote, whether occurring by a show of hands, poll or written vote,

(b) if the credit union is a central credit union, in accordance with rules that provide as set out in section 92 for proportional voting or for delegate attendance and voting determined on a proportional basis,

(b.1) if the credit union is a central credit union, in accordance with rules that provide as set out in section 92 for voting determined both by a simple majority and by a 2/3 majority on a proportional basis in respect of the same special resolution, or

(c) in accordance with rules that provide as set out in section 58 (2).

(2)  A member may vote by proxy only if

(a) the member is voting as a holder of shares in a class of equity shares that are not membership shares,

(b) the rules of the credit union allow auxiliary members to vote by proxy as holders of shares in the class referred to in paragraph (a), and

(c) the vote is on a matter on which, under the rules referred to in paragraph (b), members holding shares in the class referred to in paragraph (a) are permitted to vote by proxy.

(3)  A member of a credit union who is not an individual may be represented and vote at meetings by an individual who

(a) is not a member, and

(b) by written authorization deposited with the credit union, is authorized to vote at the meetings on behalf of the member.

Voting at a meeting

71  Unless the rules otherwise provide, voting at a meeting of a credit union must be by show of hands.

Rules may allow vote in writing and by electronic means

72  The rules of the credit union may provide for voting in an election or on a resolution or a special resolution, or as to any other matter,

(a) by written vote, or

(b) by electronic means.

Voting choices for large credit union

73  ( 1 )  If a credit union has more than 10 000 members, the rules of the credit union must allow a member to vote in an election of directors and on special resolutions

(a) by voting in person at a general meeting or voting by mail ballot, whichever method the member chooses,

(b) by voting in person at a general meeting or voting by ballot at a branch office, whichever method the member chooses,

(c) by voting in person at a general meeting, voting by mail ballot or voting by ballot at a branch office, whichever method the member chooses,

(d) by voting by mail ballot or voting by ballot at a branch office, whichever method the member chooses,

(e) by voting by ballot at a branch office, or

(f) by voting by mail ballot.

(2)  If the rules of a credit union with more than 10 000 members provide for voting by electronic means, a reference in subsection (1) to voting by ballot or mail ballot may be read by the credit union as a reference to voting by electronic means.

Annual general meeting

74  (1)  A credit union must hold an annual general meeting not more than 15 months after

(a) the date of incorporation, or

(b) the date of amalgamation under section 20 or 21,

and afterwards the credit union must hold an annual general meeting at least once in every calendar year and not more than 135 days after the credit union's financial year end.

(2)  Despite subsection (1), the commission by order applicable to one or more credit unions may extend by not more than 6 months the time within which it or they must hold an annual general meeting.

Meetings

75  (1)  The rules of a credit union may provide for the holding of general or special meetings of members by holding 2 or more meetings of members at different times and places, which meetings together are to constitute a single meeting, and, in that case,

(a) the total of the votes that are cast on a resolution or special resolution or on an election of directors at the meetings must be counted after the last of the meetings has been held, and

(b) in ascertaining the result of the voting, the votes cast at the meetings and,

(i)  if section 73 applies, any votes cast by mail ballot and any votes cast by voting in branch offices must be taken into account, and

(ii)  if the rules provide as set out in section 72, any written votes cast must be taken into account.

(2)  The directors must ensure that each notice convening the meetings that constitute a single meeting under subsection (1) states, in addition to any other information required to be contained in it, the substance of the provision allowing the holding of those meetings and that those meetings are being held under that provision.

Special general meetings

76  (1)  In this section, "proposal" means any matter proposed by members for consideration at a special general meeting and includes a proposed special resolution.

(2)  The directors of a credit union may call a special general meeting of the credit union.

(3)  By a requisition that may be signed in several counterparts, each bearing the signature of one or more members of the credit union, the members may requisition that the directors call a special general meeting for the purpose of considering a proposal.

(4)  A requisition under subsection (3) must

(a) be signed and dated by not less than 5% in number of the members or 300 members, whichever is the lesser,

(b) state the proposal to be considered at the special general meeting,

(c) state the name and mailing address of one of the members as a representative of all the requisitioning members, and

(d) be deposited at the registered office of the credit union within 60 days of the first signing of the requisition by a requisitioning member.

(5)  If the directors receive a requisition that complies with subsection (4), then, within 21 days after the date the requisition is deposited at the registered office of the credit union, the directors must

(a) call the requisitioned special general meeting to consider the proposal, or

(b) refuse to call the requisitioned special general meeting on one or more of the following grounds:

(i)  the requisition was not deposited at the registered office of the credit union at least 90 days before the anniversary date of the last annual general meeting, or at least 90 days before the date on which it is proposed that the meeting be held;

(ii)  it clearly appears that the proposal is submitted by the members for the purpose of enforcing a personal claim or redressing a personal grievance against the credit union or its directors or officers, or primarily for the purpose of promoting causes that are extraneous to the purposes of the credit union;

(iii)  substantially the same proposal was considered and defeated by the membership within the 2 years immediately before the date of deposit at the registered office of the credit union of the requisition containing the current proposal.

(6)  The directors must give notice promptly to the representative of the requisitioning members of a decision under subsection (5) to call or to refuse to call the requisitioned special general meeting, and if the directors refuse to call the meeting, they must include in the notice their reasons for the refusal.

(7)  If the directors call the requisitioned special general meeting under this section, then, at the request of the representative of the requisitioning members, the directors must attach to the proposal for circulation a statement, supplied by the requisitioning members, of not more than 400 words in support of the proposal, and the name and address of the representative of the requisitioning members.

(8)  No credit union or person acting on its behalf incurs any liability only because of circulating a proposal or supporting statement in compliance with subsection (7).

(9)  Within 14 days after the representative of the requisitioning members receives the notice referred to in subsection (6) of the directors' decision under subsection (5) (b), any member of the credit union may appeal to the commission the directors' decision to refuse to call a requisitioned special general meeting and, on receiving notice of the appeal, the commission may

(a) make an order confirming the directors' decision to refuse to call the requisitioned special general meeting, or

(b) order the directors to call the requisitioned special general meeting.

(10)  Without limiting the powers given under subsection (9), the commission, in an order under that subsection, may

(a) appoint a time and place for the requisitioned special general meeting ordered under subsection (9) (b),

(b) require amendments the commission considers necessary or advisable to the proposal, supporting statement or notice of meeting, and

(c) establish procedures for the conduct of the requisitioned special general meeting referred to in subsection (9) (b).

(11)  On receiving notice of an order made by the commission under subsection (9) (b), the directors must call the requisitioned special general meeting in accordance with the order.

Members' special resolutions at other meetings

77  (1)  By requisition signed by not less than 5% in number of the members or 300 members, whichever is the lesser, members of a credit union may propose a special resolution for consideration at a general meeting.

(2)  Section 76 applies in respect of a proposed special resolution under this section.

Notice of general meeting

78  (1)  The directors must give at least

(a) 18 days' notice, or

(b) if the rules provide for a longer period of notice, that longer period of notice

of each general meeting and each special resolution to each member of the credit union and to the superintendent.

(2)  A notice of a general meeting must specify

(a) the place, the day and the hour of the meeting, and

(b) the nature of any special business to be considered at the meeting.

(3)  If a member of a credit union consents in writing to the giving of a notice under this section to another member of the credit union who occupies the same home as the member, notice to that other member is effective notice to the person consenting.

(4)  The credit union need not give the notice required in this section to a junior member of the credit union.

(5)  If a notice of a general meeting or special resolution given under subsection (1) is sent by post, service or delivery, it is deemed to be effected by properly addressing, prepaying and mailing the notice, and, unless the rules of the credit union provide for a longer period of time, the service or delivery is deemed to have been effected 5 days, Saturdays and holidays excepted, following the date of mailing.

(6)  Where mail service is not available, a notice required under subsection (1)

(a) may be given by advertising on 2 separate occasions not less than 5 days apart, inclusive of the day of publication, in a newspaper circulating in the area in which the credit union carries on its operations, and

(b) is deemed to have been received by the member on the day of the last publication.

Meetings to be held in British Columbia

79  A general meeting of a credit union must be held in British Columbia.

Special resolutions

80  A credit union must file with the superintendent every special resolution passed by its members.

Business outside British Columbia

81  (81)  Subject to subsection (1.1), a credit union or its subsidiary, other than a central credit union or a subsidiary of a central credit union, must not carry on business outside of British Columbia.

(1.1)  With the consent of the commission and the deposit insurance corporation, a credit union or a subsidiary of a credit union may carry on business outside of British Columbia to the extent permitted under the laws of another jurisdiction.

(2)  Despite subsection (1),

(a) a credit union has and is deemed always to have had capacity to perfect or register, outside British Columbia, a note, mortgage, lien or other instrument evidencing indebtedness or obligation to the credit union and, for that purpose, to accept powers and rights from a lawful authority outside British Columbia,

(b) subsidiaries of a credit union carrying on a prescribed kind of business may carry on that kind of business outside British Columbia, and

(c) a credit union may establish agents outside British Columbia for the purpose of providing services to the credit union's members who reside in British Columbia.

Insurance

82  A credit union that, on September 15, 1990, is making or participating in contracts of insurance in reliance on section 54 (1) to (3) of the Credit Union Act, R.S.B.C. 1979, c. 79, may continue to do so in compliance with the provisions of section 54 (1) to (3) of that repealed Act, and those provisions are deemed to be conditions of that credit union's business authorization.

Directors

83  (1)  The persons who are the proposed first directors of a credit union immediately before registration of its constitution and rules under section 8 are the first directors of the credit union.

(2)  Unless the rules otherwise provide,

(a) succeeding directors must be elected in accordance with the regulations, and

(b) a director may be elected, or appointed to fill a casual vacancy on the board, in accordance with the regulations.

(3)  Only a member of a credit union is eligible to become or act as a director of the credit union.

(4)  The rules of a credit union may provide for the election of directors to represent a geographic area or class of members and may provide for the election of a director by members within the geographic area or class.

(5)  Every meeting of directors must be held in British Columbia.

(6)  A meeting of directors of a credit union by the means described in section 125 (2) of the Company Act complies with subsection (5) of this section if a majority of the directors participating in the meeting are in British Columbia at the time of the meeting.

Director training

84  (1)  The Lieutenant Governor in Council by order may designate one or more central credit unions to establish a credit union director training program.

(2)  A central credit union designated under subsection (1) that establishes a credit union director training program may specify

(a) the subject matter to be included in the training program, and

(b) the period for completion of the training program by persons enrolled in it.

(3)  Within the period specified under subsection (2) (b),

(a) a person elected or appointed for the first time as a director of a credit union, or

(b) if required by a central credit union designated under subsection (1), every director of a credit union who has not completed the program

must complete a training program established under this section.

Incorporation of central credit union

85  (1)  A central credit union may be incorporated in the same manner as a credit union, with variations the commission may permit having regard to the circumstances, except that the constitution and rules must be subscribed to by representatives of not fewer than 10 credit unions that are not subject to supervision by the commission.

(2)  A central credit union may issue only equity shares and any share issued by a central credit union before September 15, 1990 is deemed to be an equity share.

(3)  Sections 16, 44, 45 and 60 (1) and (2) do not apply to a central credit union.

Powers under other legislation

86  (1)  A central credit union may accept and exercise all rights, powers, privileges and immunities conferred on it by the Cooperative Credit Associations Act (Canada) or the Financial Institutions Act.

(2)  A central credit union may become a member of, buy shares in, deposit with or borrow money from

(a) a central credit union,

(b) a cooperative credit society or an association, as defined in the Cooperative Credit Associations Act (Canada), and

(c) any similar institution incorporated under the laws of Canada or of any province.

Significant changes

86.1  (1)  A central credit union may dispose of all or substantially all of its assets to a Canadian financial institution within the meaning of the Cooperative Credit Associations Act (Canada), but only if the financial institution is designated by regulation.

(2)  The disposition may only be made in accordance with the regulations.

(3)  The disposition must be approved by resolution at a general meeting of the central credit union of which the notice required under section 78 has been given.

(4)  The resolution must be passed by

(a) a majority of not less than 2/3 of the members who, being entitled to do so, vote in person at the meeting or, if permitted by section 70 (3), through a representative who is present in person, and

(b) if the central credit union has adopted a rule under section 92 (1) (b) that provides for voting on a proportional basis, a majority of not less than 2/3 of the votes cast according to that rule.

Canada Deposit Insurance Corporation

87  A central credit union may

(a) enter into an agreement with the Canada Deposit Insurance Corporation, the government of Canada or an agent of the Canada Deposit Insurance Corporation or of the government of Canada to obtain loans or other financial assistance or policies of insurance,

(b) act as agent of the Canada Deposit Insurance Corporation, and

(c) accept rights, powers, privileges and immunities that may be conferred on a central credit union under the Canada Deposit Insurance Corporation Act.

Agent for bond sales

88  A central credit union may act as agent for primary or secondary distribution of bonds or other evidence of indebtedness of or guaranteed by the government of Canada or a province and for that purpose may trade in the bonds or other evidence of indebtedness to the extent necessary.

Loans to members

89  A central credit union may make a loan to

(a) a member,

(b) an employee, and

(c) an employee of a member, at the request of the member.

Other services

90  (1)  A central credit union may provide services that are not prohibited by this Act or the regulations to or for its members if, in the opinion of the directors of the central credit union, the services are incidental or conducive to the sound operation of its members or to the attaining of the purposes of its members.

(2)  If it first obtains the consent of the commission to do so, and while it continues to have that consent, a central credit union may provide insurance or arrange for insurance

(a) for directors, committee members, officers and employees of its member credit unions and of subsidiaries of its member credit unions, and

(b) that may be required under section 206 of the Financial Institutions Act,

and may charge premiums for insurance.

Director's qualifications

91  An individual is not eligible to be or to continue to be a director of a central credit union unless the individual is a member of a member of the central credit union.

Rules

92  (1)  The rules of a central credit union may provide for

(a) the method of appointment or election of directors, including election or appointment

(i)  to represent a geographic area or class of members,

(ii)  by members within a geographic area or class, and

(iii)  by proportional voting,

(b) a system of attendance at meetings and for voting by delegates, including provision for delegate attendance and voting determined on a proportional basis, and

(c) non-voting members, but the number of non-voting members must not exceed the number of voting members.

(1.1)  The rules of a central credit union may provide that a specified category of special resolution must be passed by a majority of not less than

(a) 50% plus one of the votes cast, and

(b) 2/3 of the votes cast in accordance with rules that provide as set out in subsection (1) (b) for voting determined on a proportional basis.

(2)  The rules of a central credit union must provide for the transfer, redemption or purchase of equity shares.

(3)  Unless it first receives the written approval of the commission, a central credit union must not redeem, purchase or otherwise acquire equity shares of its own issue if the redemption, purchase or other acquisition would reduce the credit union's capital base to an amount less than the amount that constitutes an adequate capital base for that credit union in accordance with the regulations under section 289 (3) (f) of the Financial Institutions Act.

Orders, consents and refusals to be in writing

93  (1)  An order of the commission under section 38 (1) or 76 (9) (a) or (b) must be in writing.

(2)  A consent or refusal of a consent of the commission under section 11, 15, 15.1 (4) (c), 15.2 (1) (b), 16 (3), 20 (3), 44 (8), 81 (1.1) or 90 (2) must be in writing.

(3)  Written reasons must be given for an order referred to in subsection (1) or a refusal of a consent referred to in subsection (2).

Power to impose conditions

94  (1)  The commission may

(a) impose conditions that the commission considers necessary or desirable in respect of an order referred to in section 93 (1) or a consent referred to in section 93 (2), and

(b) remove or vary the conditions by the commission's own motion or on the application of a person affected by the order or consent.

(2)  A condition imposed under subsection (1) is conclusively deemed to be part of the order or consent in respect of which it is imposed, whether contained in or attached to the order or consent or contained in a separate document.

Hearing requirements

95  (1)  Before

(a) making an order under section 38 (1),

(b) giving a consent referred to in section 93 (2) subject to conditions,

(c) by the commission's own motion, varying conditions imposed in respect of an order or consent, or

(d) refusing to give a consent referred to in section 93 (2),

the commission must deliver notice in writing of the intended action to any person directly affected.

(2)  Not later than 14 days after receiving notice under subsection (1) of an intended action, a person directly affected, by delivering a notice in writing to the commission, may require a hearing before the commission.

(3)  A hearing required under subsection (2) must be held within a reasonable time after delivery of a notice in writing under subsection (2).

(4)  [Repealed 2004-48-18.]

(5)  After

(a) the expiry of the 14 day period referred to in subsection (2) if no hearing has been required within that period, or

(b) the hearing if one has been required within that period,

the commission may proceed in the exercise of the powers conferred under this Act in respect of the matter that was the subject of the notice delivered under subsection (1).

Public hearing

96  (1)  A hearing before the commission must be open to the public.

(2)  If the commission considers that a public hearing would be unduly prejudicial to a party or witness, the commission may order that the public be excluded from all or part of the hearing.

Witnesses at hearings

97  (1)  For the purpose of hearings under this Act, the commission or a panel of it has the same power

(a) to summon and enforce the attendance of witnesses,

(b) to compel witnesses to give evidence on oath or in any other manner, and

(c) to compel witnesses to produce records and things,

the Supreme Court has for the trial of civil actions, and the failure or refusal of a person

(d) to attend,

(e) to take an oath,

(f) to answer questions, or

(g) to produce the records or things in his or her custody or possession,

makes the person, on application to the Supreme Court, liable to be committed for contempt as if the person were in breach of an order or judgment of the Supreme Court.

(2)  Section 34 (5) of the Evidence Act does not apply for the purpose of hearings under this Act.

(3)  A person giving evidence at a hearing under this Act may be represented by counsel.

Appeal

98  (1)  A person directly affected by

(a) an order of the superintendent under section 76 (9) (a) or (b) acting in accordance with a delegation by the commission,

(b) a consent referred to in section 93 (2) that is given subject to conditions by the superintendent acting in accordance with a delegation by the commission, or

(c) a refusal of the superintendent, acting in accordance with a delegation by the commission, to give a consent referred to in section 93 (2)

may appeal the order, the conditional consent or the refusal of consent to the tribunal, and, unless otherwise provided for in this Act, sections 242.2 and 242.3 of the Financial Institutions Act apply.

(2)  Despite section 242.2 (2) of the Financial Institutions Act, an appeal under subsection (1) of this section operates as a stay unless an order is made under section 242.2 (10) (a) of the Financial Institutions Act.

(3)  A person directly affected by

(a) a consent, referred to in section 93 (2), that is given subject to conditions,

(b) a refusal of the commission to give a consent referred to in section 93 (2), or

(c) an order of the commission under section 76 (9)

may appeal the conditional consent, refusal or order to the Supreme Court and, unless otherwise provided for in this Act, section 242.4 (2) to (5) of the Financial Institutions Act applies.

Immunities

99  (1)  An action for damages because of anything done or omitted to be done in good faith

(a) in the performance or intended performance of a duty, or

(b) in the exercise or intended exercise of a power

under this Act or the regulations must not be brought against the commission, a member of it, the superintendent or a person who is subject to the commission's or superintendent's direction.

(2)  Subsection (1) does not absolve the government from vicarious liability for an act or omission of

(a) the commission or a member of it,

(b) the superintendent, or

(c) a person who is subject to the commission's or superintendent's direction

for which act or omission the government would be vicariously liable if this section were not in force.

Confidential information

100  An individual or entity who, under this Act or the regulations, obtains

(a) information, or

(b) records

that are submitted in accordance with a request that is made or an obligation that is imposed under this Act or the regulations must not disclose the information or records to any individual or entity, other than for the purposes of administering this Act and the regulations, for the purposes of a prosecution or if required by law.

Offences

101  (1)  Section 5 of the Offence Act does not apply to this Act or to the regulations.

(2)  A person commits an offence who

(a) contravenes section 13, 64 (8), 65 (3) (b) or 69 (2),

(b) contravenes section 14, 60 (4), 61 (1) or (2), 62 (2) or (5), 63 or 68,

(c) knowingly provides false information in relation to a matter under this Act,

(d) contravenes a provision of the Company Act as it applies for the purposes of this Act, or

(e) contravenes a condition of a consent given under this Act or the regulations.

(3)  If a credit union commits an offence under this Act, an employee, officer, director or agent of the credit union who authorizes, permits or acquiesces in the offence commits the same offence, whether or not the credit union is convicted of the offence.

(4)  If a credit union commits an offence under the Company Act as it applies for the purposes of this Act, a director or officer of the credit union who authorizes, permits or acquiesces in the offence commits the same offence, whether or not the credit union is convicted of the offence.

Penalties

102  (1)  A person who commits an offence under section 101 (2) (a) or (c) is liable

(a) in the case of a corporation, on a first conviction to a fine of not more than $100 000 and on each subsequent conviction to a fine of not more than $200 000, and

(b) in the case of an individual,

(i)  on a first conviction, to a fine of not more than $100 000 or to imprisonment for not more than 2 years or to both, and

(ii)  on each subsequent conviction, to a fine of not more than $200 000 or to imprisonment for not more than 2 years or to both.

(2)  A person who commits an offence under section 101 (2) (b), (d) or (e) is liable

(a) in the case of a corporation, to a fine of not more than $5 000, and

(b) in the case of an individual, to a fine of not more than $2 000.

Remedies preserved

103  A proceeding, conviction or penalty for an offence under this Act does not relieve a person from any other liability.

Limitation period

104  A proceeding for an offence under this Act or the regulations, or the Company Act as it applies for the purposes of this Act, must not be commenced in any court more than 2 years after the facts on which the proceedings are based first come to the knowledge of the superintendent or the commission, whichever comes first.

Court order to comply

105  If a person is convicted of an offence under this Act or the regulations or the Company Act as it applies for the purposes of this Act, the court in which proceedings in respect of the offence are taken, in addition to any punishment the court may impose, may order that person to comply with the provisions of this Act or the regulations or the Company Act as it applies for the purposes of this Act.

Innocent third parties

106  A provision of this Act or of the Company Act as it applies for the purposes of this Act that makes a transaction by a person illegal, void or unenforceable must not be construed as extinguishing rights of any other party to the transaction if that other party acted in good faith.

Remedy of irregularities

107  (1)  If an omission, defect, error or irregularity has occurred in the conduct of the business or affairs of a credit union by which

(a) a breach of a provision of this Act or of the Company Act as it applies for the purposes of this Act has occurred,

(b) there has been default in compliance with the constitution or rules of the credit union, or

(c) proceedings at or in connection with any general meeting, class meeting, series meeting or meeting of the directors of the credit union or at or in connection with any assembly purporting to be such a meeting have been rendered ineffective,

then, despite any other provisions of this Act or the Company Act as it applies for the purposes of this Act, the Supreme Court

(d) either of its own motion or on the application of an interested person may make an order to rectify or cause to be rectified or to negative or modify or cause to be negatived or modified the consequences in law of the omission, defect, error or irregularity, or to validate an act, matter or thing rendered or alleged to have been rendered invalid by or as a result of the omission, defect, error or irregularity, and may give ancillary or consequential directions the Supreme Court considers necessary, but

(e) before making an order, must consider the effect of the order on the credit union and on the directors, officers, members and creditors of the credit union.

(2)  An order made under subsection (1) does not prejudice the rights of a third party who has acquired those rights for valuable consideration without notice of the omission, defect, error or irregularity cured by the order.

Power to make regulations

108  (1)  The Lieutenant Governor in Council may make regulations referred to in section 41 of the Interpretation Act.

(2)  Without limiting subsection (1), the Lieutenant Governor in Council may make regulations that the Lieutenant Governor in Council considers necessary or desirable as follows:

(a) prescribing

(i)  forms corresponding to any of Forms 1 to 23 of the Company Act, and

(ii)  other forms whether or not specifically mentioned in this Act or the Company Act as it applies for the purposes of this Act;

(b) requiring the use of forms prescribed under paragraph (a);

(c) prescribing the model rules for the purpose of section 7 (3);

(d) respecting information and additional information to be contained in or to accompany

(i)  plans under section 11 (3) (b),

(ii)  personal information returns under section 11 (3) (e), or

(iii)  disclosure statements or revised disclosure statements under section 62,

and prescribing types of documents for the purpose of section 62 (2) (b);

(e) for the purposes of section 62 (3), prescribing

(i)  the circumstances and conditions, and

(ii)  the types of

(A)  equity shares that are not membership shares, or

(B)  other security instruments

issued by credit unions generally or by a particular credit union named in the regulation;

(f) prescribing fees to be paid in respect of matters connected with the administration of this Act or of the Company Act as it applies for the purposes of this Act;

(g) prescribing kinds of business for the purpose of section 81 (2) (b);

(g.1) for the purposes of section 86.1

(i)  designating Canadian financial institutions to which a disposition may be made, and

(ii)  establishing rules to be followed by a central credit union in making a disposition;

(h) defining a word or expression used but not defined in this Act or in the Company Act as it applies for the purposes of this Act.

(2.1)  Without limiting subsection (1), the Lieutenant Governor in Council may make regulations respecting any matter for which regulations of the Lieutenant Governor in Council are contemplated by this Act.

(3)  A regulation made under this Act may

(a) be made applicable generally or to a specific credit union or class of credit unions,

(b) define classes of credit unions for the purpose of the regulation, including classes that may include only one credit union, and

(c) provide differently for different credit unions or for different classes of credit unions.

(4)  A regulation made under subsection (2) (g.1) may confer on a person the power to approve or refuse a disposition under section 86.1 or to establish conditions for receiving approval.

Review of Act

109  Every 10 years, the government must initiate a review of this Act to determine what changes, if any, should be made.