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Standing Committee on Uniform Legislation and Intergovernmental Agreements
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State Law Publisher
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This, the twenty-second report of the Standing Committee on Uniform Legislation and Intergovernmental Agreements, considers proposed uniform co-operatives legislation.
This report is in response to notification by the Attorney General for Western Australia of proposed Co-operatives Law Agreement that Western Australia is entering.
In an effort to achieve uniformity of co-operatives laws throughout Australia all States and Territories are enacting new co-operatives legislation. The legislation is based around “core consistent provisions” which will be the same from State to State.
The Co-operatives Laws Agreement sets out a list of the “core consistent provisions” which will be the basis for uniform co-operatives legislation. There are however, a number of general exclusions, particularly in relation to stamp duties and appeal provisions.
Uniform co-operatives legislation has already been enacted in most other States and Territories. It is proposed that legislation will be introduced into Western Australia shortly.
The Attorney General sought the comments of this Committee on the uniform law proposal. Consultation has taken place with Western Australian industry.
The Victorian legislation is the model for the rest of Australia, harmonising and updating the ten pieces of Commonwealth, State and Territory legislation which governs the co-operative sector. The
Co-operatives Act 1996
(Victoria) legislation will be enacted by other jurisdictions.
The report sets out the background to co-operatives law in Australia and the development and growth of co-operatives in Australian society. The activities of co-operatives are discussed generally outlining that co-operatives are involved in a wide range of economic and social activities. Membership is voluntary, usually based upon a specific group of persons who have a unifying interest. The prime objective of a co-operative is to provide mutual benefits to its members. Ownership and democratic control of a co-operative is vested in the membership, which may comprise individuals and/or other corporate entities. Democratic control means the final authority to control the affairs of the co-operative rests with the members who use it. Every member has one vote only, irrespective of the capital contributed or the use of the co-operative by them. The report then outlines the push for change in co-operatives law and the reasons for the drive for uniform co-operatives legislation.
The report briefly outlines the background to the agreement to enact nationally consistent legislation. The intergovernmental agreement which sets out the Co-operatives Laws Agreement is discussed as well as the “core consistent provisions” which make up the model uniform co-operatives law. The Agreement facilitates interstate activity by co-operatives through the adopting of “core consistent provisions”. These provisions are subject to the intergovernmental arrangement. Under existing legislation, co-operatives are subject to the
if they wish to have members or issue securities across State borders.
The model legislation provides the framework for the formation, registration and management of co-operatives. It also enables some flexibility in the operation of co-operatives to promote their development. The legislation provides for greater flexibility in capital raising. The duties and liabilities of directors, officers and employees of co-operatives are spelt out and have been expanded to reflect contemporary corporate law. The seven principles of co-operation have been included in the legislation. The legislation also makes it difficult for co-operatives to be taken over through active membership provisions. A co-operative will have the legal capacity of a natural person and other powers applicable to an incorporated body.
The report then outlines the position of Western Australia and the commitment of this State to enact the “core consistent provisions” of the model co-operatives law. The report outlines the objectives of the legislation and its interface with the
. The “core consistent provisions” will comprise approximately 90 per cent of the proposed Western Australian legislation and will allow for local differences.
The report concludes that the co-operatives industry have consulted widely with government and have urged changes that will ensure the future of co-operatives. The response to the changes have been positive and the proposed uniform model act will provide improvements to co-operatives law.
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