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Victorian Co-operatives Act 1996

Purpose of the legislation

  • To improve the standards and operation of the legislation governing non-financial co-operatives in Victoria.
  • To create a base document for core consistent co-operatives legislation in other jurisdictions around Australia.

Principle policy intentions

  • To provide that incorporation as a co-operative be a right available to any group wishing to have the benefits of co-operation.
  • To enable co-operatives to have corporate powers equivalent to other corporations.
  • To maintain the principle of active member control of co-operatives, including one member one vote as central to the control of co-operatives.
  • To provide for co-operatives to have similar standards to those applying to corporations in dealings with, or reporting on activities concerning third parties.
  • To provide similar standards of directors as those applying to directors of similar sized corporations.
  • To provide co-operatives with a range of alternatives in regard to determining the optimal capital structure to best service the needs of members.
  • To enable co-operatives to merge across state borders.
  • To recognise interstate and overseas co-operatives trading in Victoria.
  • To strengthen the Registrar's powers to undertake investigations and enforcement to ensure that the interests of co-operatives, their members and the public generally, are protected.

Main features

  • Includes the 7 internationally recognised co-operative principles.
  • Interpretation of the act to promote the co-operative principles.
  • Provides for both mutual co-operatives and business co-operatives.
  • Co-operatives can be formed with, or without shares (non trading co-ops only).
  • Allows co-operatives outside Victoria and Australia to register in the state.
  • Co-operatives have the legal capacity of a natural person.
  • Members have limited liability.
  • At least 5 persons required to form a co-operative.
  • Individuals and corporate bodies can be members.
  • Members have to be 'active' to retain membership.
  • Shares only issued to 'active' members.
  • Different classes of shares can be issued.
  • Individual shareholding limited to 20% of the total number of shares issued.
  • Share transfers require approval by the board.
  • Voting relates to membership (one member one vote), not shareholding.
  • Members receive disclosure statements for major decisions.
  • No limit to the number of directors.
  • Board can transact business outside board meetings.
  • Board or members can appoint external (non member) directors.
  • A co-operative can raise funds from members and non members.
  • Annual independent audit of co-operatives affairs.
  • Enables mergers of co-operatives within Victoria and across state borders.

Link to Victorian Co-operatives Act

Click here to view the Victorian Co-operatives Act 1996.

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