Formation meeting of a co-operative

Preparation

Once the Co-operative’s rules and disclosure statement have been approved, you must hold a formation meeting to:

• approve the rules
• elect the first directors and
• authorise the application of registration of the Co-operative.

Notify prospective members, who would be eligible to join the Co-operative under the proposed rules, of the date, time, and place of the meeting.

If you are forming:

• a new Co-operative – at least five prospective members must attend the meeting
• a Co-operative group – at least one person from each Co-operative (minimum of two) must attend.

Before the meeting

• prepare two copies of the approved rules to be signed by members if adopted
• prepare one copy of the disclosure statement (if required) for signing at the meeting
• have the Application to register a Co-operative (PDF, 3.2 MB) ready for signing at the meeting
• ensure enough copies are available for everyone at the meeting.  You can distribute copies of the rules before the meeting, or let people know where they can get a copy after the meeting
• have Application for membership forms available for the prospective members to complete.

The formation meeting must elect a chairperson to run the meeting and a secretary to keep a written record of the meeting.  These positions are only for the purposes of the formation meeting.

Vote on the rules

Discuss the rules and any disclosure statement, to make sure everyone understands them. If prospective members want to change the rules, you must get approval by the Registrar of the changes.  Another formation meeting must be held.

You can avoid this delay by discussing the rules with prospective members at the drafting stage prior to submission for approval.

If there are no changes to the rules, move that the Co-operative be formed and the rules adopted.

NOTE: Two thirds of prospective members must vote to adopt the rules and to become a Co-operative.

Elect a board of directors

Vote to elect the Co-operative's board of directors according to the Co-operative's rules.

There are rules around who can direct or manage a Co-operative. You cannot direct or manage a Co-operative if you are:

• under 18
• an auditor of a Co-operative or a partner, employee or employer of the auditor
• bankrupts
• prohibited from being a director or managing a company under the Corporations Act 2001;
• convicted of an offence involving:
  • the promotion, formation or management of a body corporate
  • fraud or dishonesty
  • a breach of the Corporations Act 2001.

Anyone convicted of any of the above offences cannot be involved in managing a Co-operative within 5 years:

• of being convicted or
• of release from prison.

Apply for membership

Each ‘application for membership’ completed by members at the formation meeting, which must include:

• full name
• street and postal address
• number of shares and face value
• how much the member paid
• signature.

The application forms must be kept for the Co-operatives records.

Authorise a contact person

Attendees at the formation meeting must authorise a contact person.  The role is to liaise with Consumer, Building and Occupational Services, to complete the registration process.

Sign the formation documents

Once members have voted to adopt the Co-operative’s rules, the chair and secretary of the formation meeting must sign:

• two copies of the rules
• a copy of the disclosure statement, as required.

Please read the form carefully to determine how many directors must sign.

Where to next?

• Lodging an application to register