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Constitution, Model Rules

 

Consumer Affairs and Fair Trading may approve co-operative rules as submitted, approve the rules with amendments, or refuse to approve the rules.  Approval is given by Consumer Affairs by notice in writing to the person who submitted the rules.

 

Model Rules for the three types of co-operatives are available below.  If the model rules relating to a co-operative deal with a matter that is not dealt within the co-operative's rules, then the model rules relating to that matter are deemed to be included in the rules of the co-operative.

 

  • Model Rules

Model Rules - Trading Co-operatives

Model Rules - Non Trading Co-operative (with shares)

Model Rules - Non Trading Co-operative (no shares) 

 

  • Active Membership Rules

The rules of a co-operative must specify the primary activity or activities of the co-operative and specify the manner and extend to which a member is required to actively support the co-operative.  The support is measured against the co-operative's primary activity (or a combination of primary activities) and members are obliged to use or support an activity or activities of the co-operative in order to retain the right to be a member, including the right to vote.  Such activity level should be stated as a minimum requirement.

The co-operative must determine that the proposed active membership provisions:

  1. Are reasonable when considered in relation to the activities of the proposed co-operative as a whole.
  2. Satisfy the requirements that a member must utilise an activity of the co-operative in connection with the carrying on of the co-operative's proposed primary activity.
  3. Are measurable, relatively succinct, and precise enough to enable an objective determination to be made as to whether a particular member is active or inactive.

However, a non-trading co-operative may satisfy the requirements by providing that a member must pay a regular subscription in connection with the co-operative's primary activity.

Example of primary activity of a non-trading co-operative for artificial stock breeding in the dairy industry:

  1. The acquisition of semen and associated products for retail to members is a primary activity of the co-operative.
  2. A member shall pay a yearly subscription payable each year in order to establish active membership of the co-operative.

 

Example of primary activity of a retail-trading co-operative within the hardware retail industry:

  1. The operation of a trading store providing goods and services to its members is a primary activity of the co-operative.
  2. A member shall purchase goods and/or services from the co-operative to the value of a minimum of $ per month in order to establish active membership of the co-operative.

 

  • Special Resolutions

The rules of a co-operative cannot be altered unless the alterations are approved by a special resolution.  A special resolution is a resolution of a co-operative that is passed by a two-thirds majority of the members who vote in person or (if proxies are allowed) by proxy at a general meeting of members.



 

  • General Meetings of Members

Members in general meeting may undertake alterations to the rules, whether it is at an annual general meeting or special general meeting as long as the requirements of the Act have been met.  If there is an inconsistency between a provision of the Act and the rules of the co-operative about the procedure for altering the co-operatives rules, the provision of the Act prevails to the extent of the inconsistency.



 

  • Procedure

A draft of a proposed rule alteration must be submitted to Consumer Affairs and Fair Trading for approval at least 28 days before notice of the proposed special resolution to alter the rules is given to members.  Approval is required before the resolution altering the rules is passed by the co-operative in general meeting.  Application for approval is made using the Application for Approval of Proposed Alterations of Rules form.  Included with the application should be:

  • A copy of the proposed special resolution, together with:

    • a draft copy of the intention to propose the special resolution*; 
    • a draft copy of the reasons for proposing the special resolution*; 
    • a draft copy of the effect of the special resolution being passed*; 
    • A statement stating the reasons for the alteration; and
    • The fee.

*Note: this is a copy of the material planned for distribution to members with the notice of meeting and need not be made up of separate documents.  If a complete alteration is being made to the rules, include a completed checklist (which is part of the application form).

The co-operative must then give its members 21 days' notice stating the intention to propose a special resolution, the reasons for proposing the special resolution and the effect of the special resolution being passed.

After the special resolution has been passed at the meeting, application for registration of the proposed alterations must be submitted to Consumer Affairs and Fair Trading within 28 days.

An Application for Registration of Alteration of Rules form is used for this application and must be accompanied by the fee, as well as a printed consolidated copy of the co-operatives rules including the alteration.

An alteration of the rules does not take effect unless registered by Consumer Affairs and Fair Trading.

If the alteration is not contrary to the Act or the Regulations and there is no other reasonable cause to refuse registration, Consumer Affairs and Fair Trading must register the alterations.  If the special resolution has been passed by means of a special postal ballot, Consumer Affairs and Fair Trading will need to be satisfied that the rules of the co-operative specifically permit this to occur.  Consumer Affairs and Fair Trading will issue a certificate of registration of the alteration, and a copy will be forwarded to the co-operative.