【News】 Central Union of Agricultural Co-operatives asks ruling party to maintain its audit function (Feb. 7, 2015)


In a last-minute effort to reflect agricultural co-operatives’ opinions in the government’s agricultural reform plan, Akira Banzai, head of the Central Union of Agricultural Co-operatives (JA-Zenchu) met ruling Liberal Democratic Party lawmakers with close links to the farm sector on Friday, Feb. 6, to make a number of requests including keeping the union’s auditing system.

Banzai asked LDP members to maintain JA-Zenchu’s audits and let primary JAs choose between the central union’s audits and those by certified public accountants. He also requested that JA-Zenchu and prefectural unions have the same kind of corporate capacity under the Agricultural Co-operative Society Law, and expressed opposition to restricting non-farmer members’ use of JAs’ services.

The government and LDP are working on settling the issue of agricultural co-ops reform in the beginning of next week to compile a framework for revising the law.

Banzai attended an internal meeting of LDP lawmakers including Yoshimasa Hayashi, chairman of the party’s Research Commission on Agriculture, Forestry and Fisheries Strategy, and Takamori Yoshikawa, head of the party’s project team to discuss the bill to revise the law. Banzai made the requests based on opinions given at the meeting of prefectural union heads held on Thursday, Feb. 5, and the meeting of JA-Zenchu directors.

The government and the LDP are considering abolishing JA-Zenchu’s obligatory auditing on primary JAs and instead introducing auditing by certified public accountants. They plan to separate JA-Zenchu’s auditing section and make it into an auditing corporation, and let JAs choose between the corporation and other auditors. Meanwhile, Banzai reportedly suggested maintaining JA-Zenchu’s current auditing system and let JAs make a choice.

The government and the LDP also plan to make JA-Zenchu into a general incorporated association, while turning prefectural unions into federations based on the law, like the National Federation of Agricultural Co-operative Associations (JA Zen-Noh). Banzai demanded that JA-Zenchu and prefectural unions operate under the same corporate capacity so that they can conduct auditing, management consulting and coordination as well as functioning as representatives in an integrated manner.

Banzai also demanded that no legal restriction be introduced to non-farmer members’ use of JAs’ services, saying that such members should be regarded as JAs’ “partners.”

He also requested the government and the LDP not set legal requirements for assigning directors, while the agriculture ministry is considering making it a rule that more than half of JAs’ directors be large-scale, certified farmers and professionals of farm product sales and management.

After the meeting, Banzai told reporters that he expects the LDP to discuss the issue further, taking into account the JA group’s views.

In response to Banzai’s requests, the government and the LDP have set on compiling the final draft before the party’s project team holds a meeting on Monday, Feb. 9, where all the LDP lawmakers can attend. The LDP is highly likely to give up restricting non-farmer members’ use of JAs’ services, as many within the party are opposed to the idea, saying the move would go against the policy of revitalizing regional areas.

The party is also considering adding supplementary provisions to the law so that JA-Zenchu can maintain coordinating and representative functions.

Hayashi told reporters after the meeting that the government and the party will make further efforts to come to a conclusion based on JA-Zenchu’s opinions on the government and LDP’s plans.

(Feb. 7, 2015)

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