GUIDE TO COMPLETING THE STANDARD RULES
If the standard rules are to be adopted, there are spaces in these rules to be completed
and there are other suggested changes as follows:
The words “(If shares)” refer to a trading cooperative or a non-trading cooperative
with shares capital.
The words “(If no shares)” refer to a non-trading cooperative without share capital.
Front Page of standard rules
Delete “Standard -----the” and “Model” and
after “Of” insert the name or proposed name of the
cooperative.
SECTIONS OF THE STANDARD RULES
2(5) (Cost of copy of rules) Insert a reasonable charge for a copy of the rules, up to
the maximum listed in rule 2(5) or if no fee is inserted, then $5 applies.
3
(Powers)
The objects of the cooperative may be included in the rules. If required, section 3
may be renamed Objects and Powers with the objects listed first and then the
powers and the name of the section in the index be renamed. As an alternative the
Objects may be included under a new section 5A.
4(1)(Name) Insert the name of the cooperative. The word “Limited” or “Ltd” must
appear at the end of the name and the word “Cooperative” or “Co-operative” or
“Co-op” must appear anywhere else in the name. The officers of the cooperative
unit will check to see that the name you have chosen is available for use.
5 (Active membership provisions) Insert the proposed Primary Activity(ies) and
the Active membership requirements.
The insertion here shall identify the primary activity or activities and specify the
manner and extent to which a member is required to actively support the
cooperative. This support is measured against the cooperative’s primary activity
(or a combination of primary activities) and members are obliged to use or support
an activity or activities of the cooperative 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.
For further information on active membership provisions please refer to sections
113 to 141 of the Cooperatives Act 1997 and sections 6 and 7 of the Cooperatives
Regulation 1997.
6 (Qualifications for membership)
(If shares) (1)
Insert the minimum number of shares that every member must
hold and / or the way in which the minimum number must be
decided including for example, by reference to the use made of
the cooperative by a member.
All cooperatives Any qualifications for membership can be added to this section.
The qualification may also need to be an active membership
requirement in section 5 eg any residency district boundary.
7 (Membership etc)
(If shares) (2)
Insert the amount of deposit to be paid for each share applied for.
Note that section 13(4) of the rules states that at least 10% to be
paid.
(If no shares)
It is suggested that an additional subsection 7(7) be added where
an annual subscription is the active membership requirement in
section 5 eg
“7(7) A member must pay an annual subscription of $ (insert
amount) or such lesser amount as determined by the board from
time to time.”
Note that if the board wishes to exceed this maximum amount at some
future stage a further rule alteration to be passed by members by
special resolution will be required.
All cooperatives Schedule 1 of the Act requires the charges or subscriptions
payable by a member to the cooperative to be set out in the rules.
If there are any other charges or subscriptions required they can
be set out in this section of the rules.
12 (Fines)
Insert the value of the maximum fine which the board may impose if any (max by
regulation not more than $1 100 for trading cooperative or $110 for non-trading
cooperative). If no fines are to be applied then this section should be substituted
with;
“12(1) The cooperative is not entitled to impose fines on members.”
13 (Capital and shares)
(If shares) (1) Insert the nominal value of a share.
16 (Certificate of shares)
(If shares) (3) Insert a reasonable fee for a duplicate share certificate eg. $10.
18 (Transfer of shares)
(If shares) (7)(a) Insert the fee to be charged for the transfer of shares (eg $10).
20 (If shares) or 14 (If no shares)(Forfeiture and cancellation inactive members)
(1)(a) Insert period the member’s whereabouts not known to cooperative before
cancellation of member’s membership can commence (max 3 years).
(1)(b) Insert period the member was inactive before cancellation of member’s
membership can commence (max 3 years).
30 (If shares) or 20 (If no shares) (Transfer and transmission of debentures)
(5)(a) Insert the fee to be charged for the transfer of debentures (eg $10).
32 (If shares) or 22 (If no shares) (Special general meetings)
(2)
Insert the percentage of active members able to requisition the board to hold
a special general meeting.
35 (If shares) or 25 (If no shares) (Quorum at general meetings)
(2)
Insert the number of active members required to constitute a quorum.
44 (If shares) or 34 (If no shares) (Board of directors)
In (2),
The standard rules provides for the number of directors to be elected to be determined
by the members in general meeting within a upper and lower limits. If adopting this
rule insert the lower and upper range of numbers.
If requiring a fixed number then delete “no fewer than ……. nor more than” and
insert the number of member directors to be elected to the board.
Delete the last sentence, “The number of elected directors to the board within the
range shall be determined by the members in general meeting.”
45 (Qualifications of directors)
(If shares) (2) Insert the minimum number of shares to be held by a director.
48 (If shares) or 38 (If no shares) (First and subsequent directors)
(2)
Insert the number of directors to retire at the first annual general meeting.
(3)
Insert the number of directors to retire by rotation. An example of a rotation
rule is, if you have 5 directors and you wish them to have a 3 year term, the
rotation could be “2, 2 and 1”. Directors may be elected by a postal ballot or
by ballot at the annual general meeting (delete that not applicable).
Select either paragraphs (8) and (9) or select paragraph (10) as the manner of
electing directors under the various circumstances (delete that not applicable), and
renumber as appropriate.
61 (If shares) or 51 (If no shares) (Financial year)
Insert the financial year end of the cooperative. The financial year end is usually
the last day of a particular month. There is no set date. Most cooperatives select 30
June however an alternative date to suit the business of the cooperative and the
auditor can be selected. Note that the annual general meeting must be held within 5
months of the end of financial year.
63 (If shares) or 53 (If no shares) (Custody etc)
(2) A member may make a copy of an entry in a register either free or for a fee.
Delete that which is not applicable. If a fee is to be charged insert fee, up to a
maximum of $5 for first page and $1 for each subsequent page. If a fee is
payable, delete “free of charge.”
67 (If shares) or 57 (If no shares) (Cooperative funds)
For a trading cooperative, in paragraph (7), insert percentage of surplus which
may be applied for charitable purposes or other activity supported by the
cooperative.
For a non-trading cooperative with share capital, in paragraph (3), insert
percentage of surplus which may be applied for charitable purposes.
For a non-trading cooperative without share capital, in paragraph (2), insert
percentage of surplus which may be applied for charitable purposes.
70 (If shares) or 60 (If no shares) (Winding up)
For a trading cooperative, in paragraph (2), for the distribution of surplus in the
event of a winding-up indicate the manner to be implemented ie by usage or share
holding (delete that not applicable).
For a non-trading cooperative with share capital, in paragraph (2) insert the
name of the institution which is to receive any property or if this matter is to be
determined later omit paragraph (2) and in paragraph (3) omit the words “Subject to
subsection (2)”, and renumber paragraph (3) to (2).
For a non-trading cooperative without share capital, in paragraph (2) insert the
name of the institution which is to receive any property or if this matter is to be
determined later omit paragraph (2) and renumber paragraph (3) to (2) and
if paragraph (2) is retained, in paragraph (3) add the words “Subject to subsection
(2),” at the beginning of the paragraph.
For all non-trading cooperatives,
in paragraph (3)(a) after “objects” you may insert “or primary activities” and
in paragraph (3)(d) if the cooperative proposes to be a public benevolent institution
under the Income Tax Assessment Act 1997, paragraph (d) should be amended to
read “which is a fund, authority or institution approved by the Commissioner of
Taxation as a public benevolent institution for the purposes of any Commonwealth
taxation Act.”
71 (If shares) or 61 (If no shares) (Schedule of charges)
Add
Annual subscription
Charges
section 7 (if applicable)
section 7 (if applicable)
Further interpretations
These are not found in the model rules but have been included at the end of the
model rules supplied by this office for further guidance. They do not have to be
adopted.