What is a co-operative?

Co-operatives are organisations that are owned, controlled and used by their members. They can be structured so that the profits are put back into the co-operative or distributed to members.

Co-operatives represent one of the five basic forms of organisational structures. Other structures include sole proprietorship, partnerships, incorporated associations and companies.

Choose to be a trading or
non-trading co-operative

Co-operatives can be established as either a ‘trading’ or ‘non-trading’ structure.

If you want your members to receive a share of any surplus funds, then you should form a trading
co-operative.

If you do not want members to receive a share of any surplus funds, with any profits going directly to the co-operative, then you should form a
non-trading co-operative.

A non-trading co-operative is also likely to be more appropriate for a community organisation rather than a commercial organisation.

To provide you with the appropriate documentation, the Registry of Co-operatives & Associations, which is part of the Office of Fair Trading, will ask you to specify the type of co-operative you wish to establish.

How do I form and register a
co-operative?

Co-operatives in New South Wales are administered under the provisions of the
Co-operatives Act 1992 and the Co-operatives Regulation 1997. You can view this legislation at www.legislation.nsw.gov.au

Co-operative formation kit

Draft your disclosure statement

The disclosure statement ensures that prospective members are adequately informed about the nature and extent of their financial involvement or liability as a member of the co-operative.

The disclosure statement outlines areas such as:

• projected profit and loss
• names of prospective members and directors
• who will act as the auditor
• registered office and mailing address etc.

Get your rules and disclosure statement approved

Once you have prepared both your rules and disclosure statement, send them to the Registry which will:

• send you an acknowledgment letter with the name of the person who will be reviewing your documents
• discuss any areas that need clarification
• confirm the co-operative’s proposed operating name
• forward the approved documents to be presented at your formation meeting
• forward an Application for registration form to your co-operative.

IMPORTANT – Ensure that these documents are lodged with the Registry at least 28 days before you hold the formation meeting.

Prepare for your formation meeting

You need to hold a formation meeting to formalise the co-operative with your members.

When you have received the Application for registration form and the approved rules and disclosure statement, arrange the meeting and let prospective members know.

If you are forming a new co-operative at least five prospective members must attend.

Documents required

Before the meeting you need to:

• prepare two copies of the approved rules for signing at the meeting
• prepare one copy of the disclosure statement for signing at the meeting

• have the Application for registration form from the Registry ready for signing at the meeting
• make enough copies of the rules for everyone at the meeting or let people know where they can obtain them
• if possible, arrange for a Justice of the Peace to attend to sign the required documents
• copy the Application for membership form for the prospective members to complete. This form is contained in the Application for registration.

Hold the formation meeting

Elect a chairperson and secretary

Elect a chairperson to run the formation meeting and a secretary to keep a written record of the meeting.

Vote on the rules

Discuss the contents of the rules and the disclosure statement to make sure everyone understands them.

If prospective members want to change the rules you will need the Registry to approve these changes and another formation meeting will need to be held to accept the approved rules.

You can avoid changes to the rules at the formation meeting by discussing them with prospective members beforehand.

If there are no changes to the rules, move that the co-operative be formed and the rules be adopted.

IMPORTANT – Two-thirds of prospective members must vote to adopt the rules to become a co-operative.

Elect the board of directors

Vote to elect the co-operative’s board of directors according to the co-operative’s rules.

Apply for membership

Each member at the formation meeting needs to complete the Application for membership form.

These application forms must be signed and witnessed and kept for the co-operative’s records.

Authorise a contact person

At the formation meeting, authorise someone to liaise with the Registry to complete the registration process.

Apply to register your co-operative

Sign the formation documents

Once you have voted to adopt the co-operative’s rules and the disclosure statement, the chairperson and secretary of the formation meeting need to sign:

• two copies of the rules certifying they are approved
• the disclosure statement certifying it is approved.

Sign the Application for registration form

To register the co-operative the following people need to sign the Application for registration form:

• the chairperson and secretary
• a Justice of the Peace, Notary Public Solicitor or Commissioner for Affidavits
• two directors and three members.

Send your documents to the Registry

Within 2 months of the formation meeting, you need to send the Registry:

• the completed Application for registration
• two copies of the rules signed by the chairperson and secretary of the formation meeting certifying that they are approved
• a copy of the disclosure statement signed by the chairperson and secretary of the formation meeting certifying that it was presented
• the list of the board of directors
• the application fee – contact the Registry for the current fee or visit www.fairtrading.nsw.gov.au

The Registry will then:

• register your co-operative
• send you a registration certificate with a copy of the registered rules.

Our guarantee of service

As part of our guarantee of service, the Registry of Co-operatives & Associations guarantees that applications for approval and registration of
co-operatives that have met all requirements are processed within 28 working days of receiving the completed application.

Where to get more information

The Registry of Co-operatives & Associations
154 Russell Street
PO Box 22
Bathurst  NSW  2795

Tel: 6333 1400
Freecall: 1800 502 042 (outside Bathurst)
Fax: 6333 1444
Email: registryinquiries@oft.commerce.nsw.gov.au