Co-Operatives National Regulation (Queensland)

(Regulation 2.2)

Notes

Guide to the model rules

1 Introduction

This guide summarises the purpose and process for model rules under the Co-operatives National Law and the Co-operatives National Regulations.

A co-operative is governed primarily by the Co-operatives National Law and the Co-operatives National Regulations as applied in this jurisdiction. In addition, its operations and its relationship with its members are governed by its rules, which are a contract between the co-operative and its members as well as between each member.

A co-operative is required to have a set of rules which address each of the topics set out in Schedule 1 to the Co-operatives National Law. Other provisions of the Law or the Co-operatives National Regulations may also specify that particular matters may or must be set out in the rules.

These model rules apply to a non-distributing co-operative without share capital. A non-distributing co-operative is a co-operative that is prohibited from giving returns or distributions on surplus or share capital, other than the nominal value of shares (if any) at winding up (see section 19 of the Co-operatives National Law). There are separate sets of model rules for a distributing co-operative (Schedule 5 to the Co-operatives National Regulations) and for a non-distributing co-operative with share capital (Schedule 7 to the Co-operatives National Regulations).

2 What are model rules?

The Co-operatives National Regulations contain a set of rules that may be used by a general co-operative. These rules are called “model rules” because they are drafted to ensure that they include all matters that are required to be included in a co-operative’s rules. A co-operative is not required to use the model rules, but instead it may prepare its own rules or it may use some of the model rules and draft others to complete its rules so that they comply with the Co-operatives National Law.

General co-operatives engage in a wide range of activities and the model rules are not intended to deal with all aspects of the business or activities of a general co-operative, but they will provide a core set of rules. A co-operative will need to consider whether each of the model rules suits its activities and either adapt the rule or prepare its own rule on a particular topic.

It is important to note that a co-operative’s rules must be approved by the Registrar. The model rules are not complete as they require additional information to be inserted or deleted by a co-operative, but, once completed with the information indicated, they should be in a form ready for approval by the Registrar.

If a co-operative chooses to prepare its own rules and the rules do not make provision for a matter set out in Schedule 1 to the Co-operatives National Law, then the Registrar may insert the relevant model rule to complete the co-operative’s rules.

3 Model rules may change

The model rules are part of the Co-operatives National Regulations, and like the Regulations they may change if it is considered appropriate at some future time. If a co-operative wishes, it may adopt the model rules in a form that is static. That is, the model rules as adopted will not change unless the co-operative makes a change in the manner authorised under the Co-operatives National Law. Alternatively, the co-operative may adopt the model rules as they are from time to time. If this is done, then any future changes to the model rules will automatically change without the need for the co-operative to undertake any process to amend its rules.

Potential changes to model rules will be part of the process for changing the Co-operatives National Regulations and subject to public notice before any changes are made.

4 Instructions for using the model rules

4.1 The model rules are to be completed in accordance with any requirement indicated in Schedule 6 to the Co-operative National Regulations as to how the rules are to be completed (whether by inserting a specified detail or other information or by striking out any words or other matter, or otherwise).

4.2 A row of dots in a model rule indicates that a relevant detail or other information is required to be inserted before the rule is made.

4.3 References to the CNL or a provision of the CNL in these model rules is a reference to the principal provision(s) of the Co-operatives National Law as applied in this jurisdiction. The meaning or application of these model rules may be affected by other provisions of the Co-operatives National Law or other Commonwealth, State or Territory laws, as the case may be.

4.4 These notes and any other notes in the model rules do not form part of the model rules.