THE Wairarapa Age MORNING DAILY. TUESDAY, DECEMBER 11, 1906. THE DAIRY COMPANIES' CONFERENCE.

Wairarapa Age, Volume XXIX, Issue 8308, 11 December 1906, Page 4

THE Wairarapa Age MORNING DAILY. TUESDAY, DECEMBER 11, 1906. THE DAIRY COMPANIES' CONFERENCE.

The conference of delegates from dairy oompauies throughout the Wairarapa and Bush districts artaugert for Thursday next in Masterton is one relating to various important proposals in connection w*th the dairying industry. Seventeen companies have been invited to send delegates to the meeting, and it is hoped that the conclusions arrived at will be representative of tho views) of dairy farmers from Featberston to Woodville. The conference is invited to make suggestions by the National Dairy Associatijn, who are proposing certain amendments! to tho Companies Aot, 1903, and the Secretary of 'he Association writes that after the suggestions have been considered and embodied, if suitable, in the proposed Bill, the Bill will be submitted to the Government in order that if approved of by the Crown law officers it may be brought in next session as a Government measure. It is stated that one of the greatest difficulties is a suitable definition of the term "co-operative oompany." To limit the definition to companies whose objeot, as set forth in their memorandum of association, is the manufacture of raw materal purchased from aharehilders only into artiqles of commercial value, would exolude most 00-operativo dairy 'companies, because:—(l) Many of thesa oompauies indent largely artiolus used by their shareholders in the dairy industry. (2) Are shareholders in freezing companies or box making companies furthering the interests of the industry. (3) Carry on minor businessess, suob as storebeepmg ancillary to their main

business. (4) It would also mean \ that ne»rly ali the 'companies at present existing vronld require to alter tbeir memorandum uf association—an expensive business. To get over these difficulties sections 1, 2 and 3, set oat in the first part the definition thht a co-oper-ative company means:—-A company, on'.j of whose objects is the manufacture of raw material purchased from shareholders of the compatay into articles' of commercial value, and have provided therein that the "artioles of association of the company should provide that notwith standing anything to the contrary in the memorandum of association of Buoh company the raw material mainly used in the manufacture of such artioles of commercial value shall be purchased from shareholders in the company alone." The articles of association of existing companies could be easily altered, while the word mainly is used because some small amount of raw material outside of milk, cream oc pork might require to bo purchased from non-shareholders. To prevent companies improperly registering under this Act in order to obtain its benefits, there is a iieavy penalty provided by section & for any breach uf the artioles of association by the directors in purchasing raw : material from non • shareholders J contrary to the artioles. Sections 5 and 6 are. to legalise share dealings by co-operative dairy companies which at present are prevalent, although either illegal or of very doubtful validity. Section 5 roads as follows:—'"For the purpose of preventing shareholders who have ceased to supply a co-oper-I ative company with raw material continuing as shareholders, the directors of a co-operative oompany, or the company if authorised by resolution of Its shareholders, carried at any general or speoial meeting, may purchase all or any of the shared held by a shareholder who has supply raw material to such company upon such terms as may be agi'eed. upon between the directors of such oompany, and such shareholders. Such shares shall be paid for out of the funds of such company, and shall be deemed to be the property of the oompany, and may be sold, re-allotted or otherwise disposed of in such manner as the iirectors of *uob company may think fit." Seoiion 7 imposes a limit upon the number of shares at any time held by the company, and acquired by virtue of sections 5 and 6, ana is a protection to the general public dealing with the oompany. Section 8, like sections 5 and 6, is intended to clearly legalise aofs of the directors, which at present are constantly done, but the validity of which is doubtful. Section 9 provides that certain sections of the Companies Act, 1903, which do not apply to private 'companies, shall not apply to co-oper-ativo companies, and is intended to simplify the- formation and carrying on of a co-operative oompany. Seotiou 10 is really in lieu of section 99 of the 5 Companies Aot, 1903.