In 2011, the Legislative Reform (Industrial and Provident Societies and Credit Unions) Order 2011[7] increased the maximum shareholding limit, changed the date of submission of the annual return, permitted children to be members, and allows the publication of unaudited interim accounts.
[8] In January 2012, the UK Prime Minister, David Cameron announced a project to consolidate all the legislation applicable to industrial and provident societies to be passed by 2015.
[10] Cameron stated, "We know that breaking monopolies, encouraging choice, opening up new forms of enterprise is not just right for business but the best way of improving public services too."
[13] In September 2013, the English and Scottish Law Commissions published a draft consolidation bill and related documents for consultation.
Those drafts and other materials, including a private member's bill to liberalise the use of share capital by societies presented to the UK House of Lords were explained and brought together online.
The legislation in the Republic of Ireland is based on modifications of the UK Industrial and Provident Societies Act 1893 (56 & 57 Vict.
[18] Unlike a company limited by guarantee (another form favoured by businesses not primarily motivated by profit), an IPS always has a share capital.
Withdrawable share capital is an unusual form of finance which is treated as equity but may be withdrawn subject to specified conditions.
It has the great advantage of being exempt from the Financial Services and Markets Act, which makes the sale of securities to the public a criminal offence without compliance with expensive and onerous regulations.
The terms of society shares, whether withdrawable or not, may include the payment of interest on the capital, but this may only be paid out of profits.
[24][25] Since 2006, the FCA has been willing, in principle, to permit co-operative societies to have non-user investor members providing certain conditions are met and this, in combination with the removal of the £100,000 holding limit for non-withdrawable shares, may open up wider possibilities for co-operatives to raise finance from investors while maintaining user control.
Recent research has shown that this model has proven very resilient, with 92% of all businesses who have raised capital through community shares still trading to date.