Resources and Management of the Cooperative Society under Law No. 123 of 1983 on Fisheries Wealth Cooperatives and its Executive Regulations
12/9/2025
Resources and Management of the Cooperative Society under Law No. 123 of 1983 on Fisheries Wealth Cooperatives and its Executive Regulations
Resources and Management of the Cooperative Society under Law No. 123 of 1983 on Fisheries Wealth Cooperatives and its Executive Regulations
Resources of the Cooperative Society
Article (8) Local administrative units within whose jurisdiction the headquarters of the cooperative society is located, and public sector units wholly owned by the State, may contribute to the capital of the local cooperative society established in accordance with Law No. 123 of 1983, up to a maximum of 40% of the society’s capital according to the latest approved final accounts. The maximum contribution of cooperative societies to higher-level cooperative societies shall also not exceed 40% of their capital. In all cases, the value of the shares shall be fully paid upon subscription.
Article (9) Subject to the provisions of Article (15) of Law No. 123 of 1983 and the society’s bylaws:
The cooperative society may not issue shares with a value different from that stipulated in its bylaws, and the value of the shares shall be fully paid upon subscription.
The boards of directors of existing cooperative societies, after their re-registration in accordance with the provisions of this law, shall determine the minimum number of shares to be subscribed by each member and the amount each member is required to pay to complete his subscription in accordance with the law and the society’s bylaws. They shall also determine the method and period of payment, provided that such period does not exceed three years from the date of re-registration of the society. A member shall be deemed withdrawn from the society if he fails to complete his subscription in accordance with the preceding paragraph.
Article (10) Members may participate in the capital of the society, in addition to shares, through in-kind contributions to be evaluated by the General Authority for Fish Resources Development, or through cash contributions in accordance with what is stipulated in the bylaws. These contributions shall be evaluated at the end of each financial year of the society based on their original value or their book value in the previous year, taking into account any improvements or renewals made thereto, after deducting the appropriate depreciation rate according to their nature. The value of in-kind contributions shall be refunded in accordance with the rules set forth in Article (32) of Law No. 123 of 1983.
Article (11) Acceptance of membership in the cooperative society may not be conditional upon subscribing to more than the minimum number of shares referred to in Article (15) of Law No. 123 of 1983.The Board of Directors may require a member to increase his subscription in proportion to the increase in his ownership of boats or the services provided to him by the society. The Board of Directors shall determine the value of such increase and the period for payment.
Article (12) Donations and bequests submitted by non-foreign entities shall be accepted by a resolution of the Board of Directors, and such resolution shall not take effect unless approved by the General Authority for Fish Resources Development. The Board shall draw up minutes for the donation or bequest stating its terms, purpose, and method of implementation in a manner that does not conflict with the objectives of the society, as well as the competent decision approving it. These minutes shall be submitted to the competent regional office of the Authority within fifteen days from the date of the resolution. The General Administration for Cooperation at the Authority shall notify the society of its approval or rejection within thirty days from the date it is informed of the resolution; otherwise, the resolution shall be deemed effective.
Article (13) With regard to support funds allocated by the State, local government units, and public legal persons to cooperative societies, the society shall be obligated to direct and utilize such funds in accordance with the conditions and rules determined by the granting authority, after notifying the General Authority for Fish Resources Development, provided that this does not conflict with the purposes of the society, the provisions of the law, the executive regulations, the society’s bylaws, and the plan of the General Authority for Fish Resources Development.
Article (14) – Rules Governing Lending and Borrowing
The General Assembly shall determine each year, within the draft activity plan and the annual program of the cooperative society, the following: (a) The maximum total amount that the society may borrow during the year. (b) The maximum total amount of loans and credit facilities granted to members during the year from the borrowed funds. (c) The maximum amount that the society may lend to a single member, whether in one payment or in several installments, from such borrowed funds.
Lending and borrowing shall be for the purpose of achieving the objectives of the society as stipulated in its bylaws and within the borrowing and lending limits determined by the most recent General Assembly.
The society may not dispose of the loans it obtains except within the limits of the purposes for which such loans were granted. The society shall adhere to the terms and repayment system of the loans as determined by the lending authority.
Loans obtained by the cooperative societies or granted by them to their members shall be of the following types: (a) Short-term loans with a duration not exceeding one year. (b) Medium-term loans with a duration exceeding one year and not exceeding five years. (c) Long-term loans with a duration exceeding five years and not exceeding ten years.
Without prejudice to the privilege stipulated in Article (23) of Law No. 123 of 1983, the cooperative society may, when lending to its members, require the borrower to provide one or more of the following guarantees: (a) Submission of promissory notes for the value of the loan installments. (b) Personal guarantee. (c) Pledge of commercial or financial papers or their equivalents. (d) Possessory mortgage on real estate, movable property, or vessels owned by the borrower. (e) Comprehensive insurance of the vessel in favor of the society with one of the insurance companies or with the Cooperative Insurance Fund referred to in Article (25) of Law No. 123 of 1983, after its establishment.
The Board of Directors shall determine the required guarantee for each type of loan according to its purpose, and the Board may also require acceptance of any other guarantees it deems sufficient. Loans granted by the society to its members shall be secured by guarantees accepted and deemed sufficient by the Board of Directors, taking into account the borrower’s need for the loan and his ability to repay it.
Loans shall not be granted for consumption purposes, except for loans related to provisioning and equipping vessels for fishing trips.
If the society obtains loans from one of the local administrative units or public sector units wholly owned by the State that participate in its capital, members shall be prohibited from withdrawing from the society if such withdrawal would result in a reduction of the society’s capital, unless the lending authority approves the withdrawal.
The society may not lend to non-members.
The society may not grant long-term loans from its own funds, and medium-term loans may not exceed 6% of its capital and reserves. The total amount of short-term and medium-term loans may not exceed 50% of its capital and reserves.
In short-term loans granted by the society from its own funds, the loan term may not be extended unless the borrower has paid half of his debt, and the term may not be extended more than once.
The interest on loans obtained by the society shall be as follows:
(a) The difference between the lending interest rate and the borrowing interest rate shall not exceed:
2% for short-term loans,
1% for medium-term and long-term loans, where the society borrows from external sources.
(b) The difference between the commission rate charged by the society to its members and the commission rate charged by the Cooperative Societies Support Fund for Fishermen shall not exceed:
0.5% for short-term loans,
1% for medium-term loans,
1.5% for long-term loans, where the society borrows from loans obtained from the Support Fund.
12. In all cases, cooperative societies shall be obligated, when lending to their members, to apply the same terms and rules under which they themselves are lent by the lending authorities.
Article (15) – Method of Payment, Refund, and Disposal of Share Value
Subject to the provisions of Articles (15) and (32) of Law No. 123 of 1983, Article (9) of the Executive Regulations, and the society’s bylaws:
A member, upon approval of the Board of Directors, may assign his shares to another member or to a non-member who fulfills the conditions of membership, provided that such person declares in writing his acceptance of membership and of the obligations arising from the assignment and the society’s bylaws.
A member wishing to withdraw from the society or to assign all of his shares to another member shall submit a request to the Board of Directors declaring his intention to withdraw or assign all of his shares at least three months before the end of the financial year. The Board shall issue its decision specifying the obligations incumbent upon the withdrawing member in accordance with the latest approved budget for the financial year in which the withdrawal occurs. No assignment or withdrawal shall take effect except with the approval of the Board of Directors.
A member whose membership ceases due to withdrawal, dismissal, or loss of one of the conditions of membership, as well as the heirs of a deceased member within the limits of what devolves to them from his estate, shall have the right to recover the value of his shares in the society, provided that this does not result in a reduction of the society’s capital during a single year by more than 10% of the subscribed capital according to the latest approved final accounts.
The value of such shares shall be refunded according to their actual value in the society’s capital at the end of the financial year in which the membership ceases, in accordance with the final accounts approved by the General Assembly for that year, after deducting all debts owed by the member to the society. In this case, the reserve funds, doubtful debts, and provisions allocated for specific purposes shall not be included in the valuation of the society’s assets. The society shall pay the value of such shares within a maximum period of six months from the date of approval of the annual final accounts. Under no circumstances may the society pay an amount exceeding that originally paid by the member.
Management of the Cooperative Society
Chapter One
The General Assembly
Article (16) (a) The General Assembly of cooperative societies shall consist of all members who have the right to vote. (b) A member may delegate another member to attend the General Assembly on his behalf; however, no member may represent more than one member. (c) The General Assembly of a joint cooperative society shall consist of all members of the Boards of Directors of the participating local cooperative societies. (d) The General Assembly of the general cooperative society shall consist of all members of the Boards of Directors of the local cooperative societies and the joint cooperative societies forming it.
Article (17) Each local administrative unit and each public sector unit wholly owned by the State that contributes to the capital of the local cooperative society shall have one representative in the General Assembly. The representative of each entity shall be designated by an official letter issued by its head, specifying the name of the authorized representative to attend the meetings of the General Assembly.
Article (18) Upon completion of the procedures for registering the cooperative society, the provisional committee shall invite the General Assembly to convene its first meeting within a maximum period of three months from the date of publication of the summary of the articles of incorporation and the bylaws in the Official Gazette. If the said committee fails to invite the General Assembly to convene within the aforementioned period, the General Assembly shall convene by force of law at nine o’clock in the morning on the first Friday of the fourth month following the date of publication in the Official Gazette.
Article (19) An invitation to convene an extraordinary meeting of the General Assembly shall be issued at least fifteen days prior to the meeting date. The invitation shall specify the date of the second meeting in the event that the legal quorum is not met, provided that the date of the second meeting shall not exceed fifteen days following the date of the first meeting. The invitation shall indicate the place, date, time of the meeting, and the agenda.
Article (20) Invitations to convene General Assemblies of all types shall be issued by posting them at the headquarters of the society, at gathering places of member fishermen, and at fish collection centers. In the case of joint and general cooperative societies, the invitation shall also be published in one of the newspapers, and the member societies shall be notified by registered letters with acknowledgment of receipt. The invitation shall specify the place and time of both the first and second meetings, as well as the agenda.
