7.5.4 Suspension and cancellation of registration
Sections 5 to 8 of the Co-operatives and Community Benefit Societies Act 2014 give the FCA the power to suspend or cancel the registration of a society. This power of cancellation is mainly applied to societies that repeatedly fail to submit an annual return and accounts. Failure to submit an annual return and accounts to the FCA no later than seven months after the end of a society’s year end is a criminal offence punishable by a fine of up to £1,000 per offence.
The FCA can also suspend or cancel the registration of a society which is failing to satisfy the conditions of its registration as either a co-operative society, community benefit society or pre-2014 registered society. This can include societies that have obtained their registration by fraud or mistake, exist for illegal purposes, or are wilfully violating the provisions of 2014 Act in some other way.
The procedure for suspending or cancelling the registration of a society is set out in the 2014 Act. This includes details of the notice the FCA must give to a society of its intention to cancel or suspend registration, and the rights of a society to appeal against the FCA’s actions.
A society can voluntarily choose to cancel its registration. The procedure for this is explained in Section 2.9.5. Cancellation must not be used to avoid insolvency proceedings.