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cooperatives_and_associations
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/Factsheet_print/Cooperatives_and_associations/Running_a_cooperative/_Co-operative_membership.pdf
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Standard fact sheet.
/Factsheet_largeprint/Cooperatives_and_associations/Running_a_cooperative/_Co-operative_membership.pdf
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Large print fact sheet.

Co-operative membership 

Co-operative members are those who initially signed the application for registration and those admitted in accordance with the rules.

There may be individual, joint or body corporate members. The rules may restrict or exclude body corporate and joint members.

Is there a limit on the number of members? 

The Co-operatives National Law (the CNL) does not impose a maximum limit on the number of members of a co-operative. However, a co-operative must generally have at least five members at all times.

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What must I do to qualify for membership? 

To qualify for membership there must be reasonable grounds to believe that you will be an active member.

The rules may provide additional requirements other than the active membership provisions.

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What is active membership? 

To remain a member, you must maintain an active relationship with the co-operative. The rules will specify what you must do for the co-operative to remain an active member. These requirements are based on the needs of the co-operative and members.

If you do not fulfil the active membership requirements, you cannot vote at meetings or be a director on the co-operative’s board. Directors must cancel the membership of inactive members.

The rules must set out the consequences of failing to be an active member.

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Are there any fees or subscriptions? 

The rules may require you to pay entrance fees and regular subscriptions to the co-operative. Prospective members must be provided with written notice of any fees and subscriptions. You are not required to pay any fee or subscription that was not included in the notice, unless it is included in an alteration to the rules. The rules must also set out any charges you must pay.

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What is the liability of members to the co-operative? 

As a member, you are not under any personal liability to the co-operative, except for any charges payable as set out in the rules.

In the case of a co-operative with share capital, the personal liability includes the amount unpaid on the shares you hold.

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Who can vote at a general meeting of a co-operative? 

Each active member is entitled to one vote at a general meeting. Inactive members cannot vote. Joint members have one vote between them.

Where a co-operative’s primary activity is the operation, maintenance or carrying on of a club, the rules may provide for different classes of membership with restrictions on voting rights. The co-operative will also need to ensure that membership with full voting rights is greater than 40% and that the rules have been approved by the Registrar.

Voting may be by proxy if set out in the rules.

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Can persons under the age of 18 be members and vote? 

Unless the rules state otherwise, persons under the age of 18 (minors) may become members. Minors are generally entitled to the rights and privileges of membership, but they are not entitled to vote or be on the board. The rules may place further restrictions on the membership entitlements of minors.

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What if there is a dispute between members? 

Disputes between members, the co-operative or the board must be dealt with in accordance with the dispute resolution procedure contained in the rules.

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Can members request a general meeting? 

Yes, the board must convene a meeting on the written requisition of 20% of active members (or a lesser percentage if this is specified in the rules). If the board does not call the meeting within 21 days after the requisition is served, the requisitioning members may convene the meeting.

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Can a member inspect a co-operative's books and documents? 

By law, co-operatives must keep a number of registers available for inspection by any member during reasonable hours. The rules may also state that specific documents are available for inspection that are not specified in the Act, such as board minutes.

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What is the register of members? 

The CNL requires the co-operative to maintain a register of members. This includes the establishment, maintenance, safe keeping and inspection of the register of members. The register must be kept at the registered office of the co-operative and available for inspection free of charge by a member of the co-operative at any reasonable hour.

The register should specify the name and address of each member together with the date on which that person became a member. If the co-operative has share capital, the register must record the details of those shares.

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When does a member cease to be a member of a co-operative? 

A person ceases to be a member:

  • if the person becomes inactive
  • if the person is expelled in accordance with the rules
  • if the rules state that membership ceases if the person becomes bankrupt or becomes subject to control under the law relating to bankruptcy
  • on death of the person
  • if the contract of membership is withdrawn on the ground of misrepresentation or mistake
  • on resignation, if set out in the rules
  • in the case of a body corporate, if the body is dissolved
  • in any other circumstances specified in the rules.

For a co-operative with share capital, a person ceases to be a member:

  • if the person’s share is transferred to another person and the transferee is registered as the holder of the share
  • if the person’s share is forfeited
  • if the person’s share is purchased by the co-operative
  • if the amount paid up on the person’s share is repaid to the person.

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Further information 

For further information please contact:

Registry Services
PO Box 22
Bathurst NSW 2795
Tel: 6333 1400
Freecall: 1800 502 042
Email: registryinquiries@finance.nsw.gov.au

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