Change text size:   Increase font size   Reduce font size  |   Print page:   Print this page
  |   Contact us   
 
nosection
English
/Factsheet_print/Cooperatives_and_associations/Running_a_cooperative/_Postal_ballots_for_co-operatives.pdf
/mobile0c9a66/common_res/global/images/pdf.gif
Standard fact sheet.
/Factsheet_largeprint/Cooperatives_and_associations/Running_a_cooperative/_Postal_ballots_for_co-operatives.pdf
/mobile0c9a66/common_res/global/images/pdf_largeprint.gif
Large print fact sheet.

Postal ballots for co-operatives 

What is a postal ballot and a special postal ballot? 

A postal ballot is a convenient method for voting on a resolution where members are geographically dispersed or have difficulty attending a meeting. Special postal ballots have additional notice and disclosure requirements.

A postal ballot can be used to determine any ordinary or special resolution as provided for in the co-operative’s rules. The rules may also specify matters that must be passed by postal or special postal ballot.

In addition, the Co-operatives National Law (the CNL) sets out circumstances where a postal ballot or a special postal ballot must be held.

Top of page

What is included in the co-operative’s rules? 

A co-operative’s rules should specify the matters to be determined by postal ballot.

The method of conducting postal ballots and special postal ballots must be included in the co-operative’s rules (Schedule 1 to the CNL). The method must include but is not limited to the:

  • sending and filing of information and votes by fax or electronic means
  • way of voting
  • majority necessary for carrying resolutions, and
  • any special majority (in addition to the requirements of the CNL) the co-operative requires to pass specified resolutions.

In accordance with the Co-operatives National Regulations (the CNR) the procedure for conducting a postal ballot or special postal ballot must:

  • be secure, transparent and independent
  • provide for the appointment of a returning officer who will manage the conduct of the postal ballot, and
  • allow a reasonable time for members to consider, record and return their vote.

Top of page

What types of resolutions can a postal ballot determine? 

A postal ballot can be used to determine any ordinary or special resolution as permitted or required in the co-operative’s rules.

The legislation also requires that certain special resolutions be passed by a postal or a special postal ballot.

Top of page

What majority is required to pass a resolution by postal ballot? 

Ordinary resolutions

An ordinary resolution is a resolution that is passed by a simple majority of members of the co-operative who, being entitled to vote, cast formal votes in the postal ballot in favour of the resolution.

Special resolutions

Postal ballot: A two thirds majority of members of the co-operative who, being entitled to vote, cast formal votes in the postal ballot in favour of the special resolution.

Special postal ballot: A three-quarters majority of members of the co-operative who, being entitled to vote, cast formal votes in the special postal ballot in favour of the special resolution.

A co-operative’s rules may require a higher majority voting percentage on specified matters.

Top of page

Conducting a postal ballot 

Postal ballots must be conducted in accordance with the co-operative’s rules.

If the procedure allows for electronic facilities to be used for the postal ballot, members who have limited or no access to electronic facilities must have an alternative mechanism available for them to vote.

Subject to the co-operative’s rules, the board may determine how the postal ballot will be conducted.

The postal ballot procedure must provide for the appointment of a returning officer, who will conduct the ballot on behalf of the co-operative and declare the ballot results.

Following the declaration, the secretary must record the outcome in the minutes of the co-operative showing:

  • the number of formal votes cast in favour of the proposal
  • the number of formal votes cast against the proposal, and
  • the number of informal votes cast.

Top of page

When is a special postal ballot required? 

The CNL requires some matters to be determined by a special postal ballot. There are additional notice and disclosure requirements which must be met when conducting a special postal ballot.

The CNL requires a co-operative to conduct a special postal ballot in the following circumstances:

  • when seeking to convert to a co-operative with share capital or to a co-operative without share capital or from a distributing to non-distributing co-operative or vice versa (s.35)
  • when requiring members to take up or subscribe for additional shares (s.82)
  • when requisitioned by members to conduct a special postal ballot (s.250)
  • when requiring members to lend money to the co-operative (s.343)
  • when proposing to acquire or dispose of certain assets (s.359)
  • when proposing to increase the maximum permissible level of share interest (s.363)
  • when certain share offers have been received (s.374)
  • when proposing a merger or transfer of engagements (ss.396 and 476)
  • when proposing a transfer of incorporation (s.404)
  • when proposing to enter a compromise or arrangement with any of its members (s.414)
  • when proposing a voluntarily winding up by members (s.445).

Top of page

Conducting a special postal ballot 

For a special postal ballot a co-operative must send to each member a disclosure statement which has been approved by the Registrar.

The disclosure statement is required to set out information that is necessary for a member to make an informed assessment of certain proposals put forward by the board of directors. The CNL requires specific information to be included in the disclosure statement for a number of the above proposals. Co-operatives should carefully consider the relevant section(s) of the CNL to determine whether additional information is required. The Registrar may also require a report by an independent person, regarding certain aspects of a proposal, to accompany the disclosure statement.

Proforma disclosure statements are available from Registry Services as a guide to assist co-operatives and their advisers preparing disclosure statements where a special postal ballot is required. However these are not intended to be an exhaustive statement that would constitute appropriate disclosure in every case.

In limited circumstances a co-operative may be given an exemption from the requirement to issue a disclosure statement. Enquiries regarding possible exemptions should be directed to Registry Services.

A special postal ballot must be held in accordance with s.248 of the CNL and the co-operative’s rules. Members must be given a minimum of 28 days’ notice of the ballot. This period is intended to give sufficient time for a meeting to be called and held to consider the proposal.

Top of page

Exemption from special postal ballot requirements 

The registrar may exempt a co-operative from the need to conduct a special postal ballot as required under sections 35, 343, 359, 396, 404 and 445.

Matters to be taken into account in considering an application for exemption from the requirement to conduct a special postal ballot include:

  • the number of members of the co-operative
  • the proximity of the members to the place where any meeting to consider the proposal would be conducted
  • the number of members who historically have attended meetings and/or participated by postal ballot
  • whether the co-operative has any reason to anticipate a meeting will enable greater member participation
  • whether proxy voting is available to enable members who are unable to attend a meeting to cast a vote in relation to the proposal
  • the proposed timing of the meeting ie. whether the meeting is timed to enable the maximum number of members to attend
  • any other matter the co-operative considers relevant

Who is eligible to vote in a postal ballot or a special postal ballot? 

A member cannot vote in a postal ballot if the member is not an active member of the co-operative or is otherwise not entitled to vote under the CNL.

Top of page

What is the role of the board of directors? 

The board of directors must ensure a postal ballot or a special postal ballot is conducted as required and in accordance with the CNL and the co-operative’s rules.

Top of page

Further information 

For further information please contact:

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

Top of page

Get a free copy of Adobe Acrobat Reader so you can access PDF versions of our information.