There are three steps to registering a new co-operative under the Co-operatives National Law (NSW) (the CNL):
To assist with the formation of a co-operative, model rules are available. NSW Fair Trading’s Registry Services has developed a template disclosure statement for completion by proposed co-operatives that have to prepare a disclosure statement.
Prospective members, directors and employees can prepare these documents, however the services of an accountant or solicitor may be required.
A co-operative’s rules describe the way in which the group organises its activities.
They must contain certain matters required by Schedule 1 of the Co-operatives National Law including:
|IMPORTANT - Discuss the draft rules with prospective members and decide on any changes before submitting them to the Registry for formal approval. Of particular importance is the active membership rule which should set out precisely the primary activities of the proposed co-operative and what members need to do to support an activity of the co-operative or to maintain a relationship with the co-operative. See Co-operatives active membership.|
Distributing co-operatives must prepare a disclosure statement for prospective members.
A disclosure statement is not usually required for a non-distributing co-operative except in limited circumstances where the operations of the proposed co-operative mean there is likely to be a significant financial risk to members.
The formation disclosure statement document must contain information necessary to ensure prospective members understand the nature and extent of their financial involvement or liability as a member of the co-operative. The disclosure statement should address:
If the disclosure statement includes a statement or a report by a person (eg. an accountant or auditor) the disclosure statement must also state the person has given consent to the statement being included in the form and context in which it appears.
The draft rules and if the proposed co-operative is a distributing co-operative, the draft disclosure statement should be submitted to Registry Services for approval along with the Application to approve co-operative rules and formation disclosure statement (form C1). Fair Trading will, within 28 days:
Once the rules and any disclosure statement have been approved, arrange the formation meeting and notify prospective members of the meeting details. At least five prospective members must attend the meeting. Before the meeting you need to:
A formation meeting is held to approve the rules, elect the first directors and to authorise the application for registration of the co-operative. The following business should take place at the meeting.
Elect a chairperson to run the meeting and a secretary to keep a written record of the meeting.
Any disclosure statement approved by the Registrar must be presented to the meeting.
Discuss the contents of the rules and disclosure statement to make sure the rules are acceptable to the prospective members.
If prospective members want to change the rules, the Registrar will need to approve these changes and another formation meeting will need to be held to accept the rules. You can avoid this by discussing the rules before submitting them for approval and before the meeting itself.
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.|
Vote to elect the co-operative’s board of directors according to the co-operative’s rules.
Record membership details of persons applying for membership of the proposed co-operative. Application forms should be kept for the co-operative’s records.
Authorise someone to liaise with Registry Services to complete the registration process.
Once you have voted to adopt the co-operative’s rules and disclosure statement, the chairperson and secretary of the formation meeting need to sign two copies of the rules certifying they are approved and the disclosure statement certifying it is approved.
At least five persons who are qualified to be active members of the co-operative must sign the Application to register a co-operative form.
Within two months of the formation meeting, send the following to Registry Services:
Registry Services will then:
Generally processing time will be within 28 days however this will depend on whether further information is required.
Your registration will come into effect on the date Fair Trading registers your co-operative.
Contact Registry Services
PO Box 22
Bathurst NSW 2795
Tel: 6333 1400
Freecall: 1800 502 042
Get a free copy of Adobe Acrobat Reader so you can access PDF versions of our information.