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Associations Incorporation Bill 2009
b2007-086-22.d24
Explanatory note
This explanatory note relates to this Bill as introduced into Parliament.
Overview of Bill
The object of this Bill is to repeal and re-enact the Associations Incorporation Act
1984. The proposed Act, like the current Act, provides for the incorporation of
certain kinds of associations and regulates the conduct of their affairs. The proposed
Act, unlike the current Act:
(a) distinguishes between large (Tier 1) and small (Tier 2) associations for the
purposes of financial reporting, so enabling tighter reporting and auditing
requirements to be imposed on the former, and
(b) requires an association’s public officer, and at least 3 of its committee
members, to be resident in Australia, and
(c) requires an association’s committee members to disclose their pecuniary
interests in any matters to be discussed at a committee meeting, and
(d) creates a number of offences with respect to fraudulent behaviour and misuse
of confidential information by an association’s committee members, and
(e) enables an association to be ordered to change its name if the name under
which it is registered is unacceptable for any of a number of specified reasons,
and
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(f) enables an association to allow postal voting by its members, and
(g) enables an association’s registration to be reinstated if its registration is
mistakenly cancelled.The proposed Act:
(a) restricts to particulars of internal management and administration the matters
for which an association’s constitution must provide, and
(b) removes the requirement for an association’s documents to be executed under
seal, and
(c) enables offences under the proposed Act to be dealt with by way of penalty
notice, and
(d) enables fees under the proposed Act to be waived, remitted or postponed in
appropriate circumstances, and
(e) clarifies the obligations of an association’s outgoing committee members and
public officer to hand over documents in their possession that relate to the
association’s affairs, and
(f) clarifies the procedures to be followed for the purpose of reserving a name for
use by an association, and
(g) clarifies the circumstances in which an administrator may be appointed to
manage an association’s affairs.
Outline of provisions
Part 1 Preliminary
The proposed Part contains provisions with respect to the name of the Act (clause 1),
its commencement (clause 2), its objects (clause 3), the defined terms that it uses
(clause 4) and an extensive definition of “pecuniary gain” (clause 5).Part 2 Registration of associations
Division 1 Registration
The proposed Division contains provisions with respect to applications for
registration (clause 6), the determination of such applications (clause 7), the
incorporation of associations that do not already have corporate status (clause 8) and
the continuity of incorporation of those that do (clause 9).Division 2 Changing association’s name, objects,
constitution or official address
The proposed Division contains provisions with respect to applications for changes
in an association’s particulars (clause 10), the power to direct an association to apply
to change its name (clause 11), the determination of such applications (clause 12),
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the obligation of an association to notify changes in its official address (clause 13)
and the effect of registration of a change in an association’s particulars (clause 14).Division 3 Reservation of names
The proposed Division contains provisions with respect to applications for
reservation of names for use by associations (clause 15), the determination of such
applications (clause 16), the period (3 months) for which reservation lasts (clause 17)
and the proscription of unacceptable names (clause 18).Part 3 Basic features of associations
Division 1 Association powers
The proposed Division contains provisions with respect to the legal capacity and
powers of an association (clause 19), the ability of an association’s constitution to
limit those powers (clause 20), the ability of an association to act through an agent
(clause 21) and the execution of an association’s documents (clause 22). These
provisions generally follow sections 124–127 of the Corporations Act 2001 of the
Commonwealth.Division 2 Assumptions people dealing with associations
are entitled to make
The proposed Division contains provisions with respect to the circumstances in
which certain assumptions may be made in any dealings with an association (clause
23) and the nature of the assumptions that may be made (clause 24). These provisions
generally follow sections 128 and 129 of the Corporations Act 2001 of the
Commonwealth.Division 3 General
The proposed Division contains provisions with respect to a model constitution (to
be prescribed by the regulations) that may be adopted by an association (clause 25),
the nature of an association’s relationship vis-a-vis its members (clause 26) and the
effect of contracts entered into in the name of an association prior to its registration
(clause 27).Part 4 Management of associations
Division 1 Committee members
The proposed Division contains provisions with respect to the establishment of a
committee for an association (clause 28), the register of committee members to be
kept by an association (clause 29), when and how committee meetings may be held
(clause 30), the disclosure of private interests by committee members (clause 31), the
creation of an offence of making dishonest use of information acquired as a
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committee member (clause 32) and the creation of an offence of making dishonest
use of one’s position as a committee member (clause 33).Division 2 Public officer and authorised signatories
The proposed Division contains provisions with respect to the appointment of a
public officer for an association (clause 34), vacation of office by an association’s
public officer (clause 35) and the appointment of authorised signatories to execute an
association’s documents (clause 36).Division 3 General
The proposed Division contains provisions with respect to when and how an
association’s general meetings may be held (clause 37), voting generally (clause 38),
voting on special resolutions that require at least a 75% majority vote (clause 39), the
creation of an offence of conducting an association’s affairs for pecuniary gain
(clause 40) and the creation of an offence of failing to put an association’s name on
its correspondence (clause 41).Part 5 Financial reporting
Division 1 Tier 1 associations
The proposed Division contains provisions with respect to the identification of
associations with significant income or assets as “Tier 1 associations” (clause 42),
the preparation and auditing of financial statements for Tier 1 associations (clause
43), the submission of such statements and reports at an association’s annual general
meeting (clause 44) and the lodgment of a financial summary, accompanied by such
statements and reports, with the Office of Fair Trading (clause 45).Division 2 Tier 2 associations
The proposed Division contains provisions with respect to the identification of
associations that are not Tier 1 associations as “Tier 2 associations” (clause 46), the
preparation of financial statements for Tier 2 associations (clause 47), the submission
of such statements at an association’s annual general meeting (clause 48) and the
lodgment of a financial summary with the Office of Fair Trading (clause 49).Division 3 General
The proposed Division contains provisions with respect to the keeping of proper
records in relation to an association’s financial transactions (clause 50), the power to
order the auditing of an association’s financial records (clause 51), the qualifications
to be held by an association’s auditor (clause 52) and the exemption of associations
from the requirements of the proposed Part (clause 53).
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Part 6 External administration and winding up
Division 1 External administration on grounds of insolvency
The proposed Division contains provisions with respect to the adoption of the
relevant provisions of the Corporations Act 2001 of the Commonwealth with respect
to the administration of an association that has become insolvent (clause 54).Division 2 External administration on grounds other than
insolvency
The proposed Division contains provisions with respect to the appointment of an
administrator for an association otherwise than on the grounds of insolvency (clause
55), the transfer to an administrator so appointed of the management of an
association’s affairs (clause 56), the revocation of an administrator’s appointment
(clause 57), the recoupment from an association’s funds of the expenses of
administration (clause 58), the liabilities to which an administrator is subject (clause
59), the stay of legal proceedings against an association while the association is under
administration (clause 60) and the furnishing of reports by an administrator as to his
or her administration of an association’s affairs (clause 61).Division 3 Winding up
The proposed Division contains provisions with respect to the voluntary winding up
of an association (clause 62), the involuntary winding up of an association pursuant
to an order of the Supreme Court (clause 63), the adoption, with specified
modifications, of the relevant provisions of the Corporations Act 2001 of the
Commonwealth with respect to the winding up of an association (clause 64), the
distribution of surplus property after payment of an association’s debts and liabilities
(clause 65) and appeals to the Supreme Court against a liquidator’s acts, omissions
and decisions (clause 66).Division 4 Offences relating to incurring of debts or
fraudulent conduct
The proposed Division contains provisions with respect to the circumstances in
which this Division applies to an association (clause 67), the creation of an offence
of incurring a debt to an association while the association is, or is imminently to
become, insolvent (clause 68), the creation of an offence of being knowingly
concerned in any fraudulent act done by an association while the association is, or is
imminently to become, insolvent (clause 69), the powers of the Supreme Court with
respect to a person who is convicted of such an offence (clause 70) and the
preservation of certain rights to indemnity, subrogation or contribution (clause 71).
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Part 7 Cancellation and transfer of registration
Division 1 Voluntary cancellation
The proposed Division contains provisions with respect to applications for
cancellation of an association’s registration (clause 72), the power to direct an
association to apply for cancellation of its registration (clause 73), the determination
of such applications (clause 74) and the distribution of assets of an association whose
registration has been cancelled under the proposed Division (clause 75).Division 2 Involuntary cancellation
The proposed Division contains provisions with respect to the cancellation of an
association’s registration, on specified grounds, by the Director-General (clause 76)
and the distribution of assets of an association whose registration has been cancelled
under the proposed Division (clause 77).Division 3 Transfer of registration
The proposed Division contains provisions with respect to applications for a
“transfer of registration declaration” to facilitate the registration of an association as
a corporate entity (such as a company or co-operative) under some other law (clause
78), the determination of such applications (clause 79) and the authority conferred by
a transfer of registration declaration (clause 80).Division 4 General
The proposed Division contains provisions with respect to the loss of corporate status
by an association whose registration is cancelled (clause 81), notification of the
cancellation of an association’s registration (clause 82), preservation of the liabilities
of an association’s committee members and public officers following cancellation of
the association’s registration (clause 83) and the reinstatement of registration where
an association’s registration has been mistakenly cancelled (clause 84).Part 8 Enforcement provisions
Division 1 Power to require information and documents
The proposed Division contains provisions with respect to the power to require
production of information and documents in relation to an association’s affairs
(clause 85), the power to enter premises at which an association carries on its
activities (clause 86), the issue of search warrants authorising entry to residential and
other premises (clause 87), the manner in which powers of entry are to be exercised
(clause 88) and the payment of compensation for damage caused by the exercise of
a power of entry (clause 89).
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Division 2 Offences
The proposed Division contains provisions with respect to the creation of an offence
of unlawfully using the word “Incorporated” or “Inc” in the name of an organisation
that is not a registered association (clause 90), the liability of an association’s
committee members for offences committed by the association (clause 91), the
creation of an offence of obstructing or hindering an authorised officer in the exercise
of his or her functions (clause 92), the issuing of penalty notices for offences under
the proposed Act (clause 93) and the venue in which, and the time within which,
proceedings for an offence under the proposed Act may be commenced (clause 94).Part 9 Application of Corporations legislation
The proposed Part contains provisions with respect to the exclusion, pursuant to
section 5F of the Corporations Act 2001 of the Commonwealth, of certain matters
concerning an association from the application of Corporations legislation within the
meaning of that Act (clause 95), the declaration of other matters concerning an
association as matters to which the Corporations legislation applies (clause 96) and
the modification of the provisions of the Corporations legislation so applied (clause
97).Part 10 Miscellaneous
The proposed Part contains provisions with respect to the Register of Incorporated
Associations (clause 98), the refusal to register documents (clause 99), the issuing of
evidentiary certificates (clause 100), the service of documents (clause 101), the
appointment of authorised officers (clause 102), the exclusion of personal liabilities
(clause 103), the review of certain decisions by the Administrative Decisions
Tribunal (clause 104), the power to waive, remit or postpone certain fees (clause
105), delegations (clause 106), the power to make regulations (clause 107), the repeal
of the Associations Incorporation Act 1984 and the regulation under that Act (clause
108) and the quinquennial review of the proposed Act (clause 109).Schedule 1 Matters to be addressed in association’s
constitution
The proposed Schedule lists the various matters that must be addressed in an
association’s constitution.Schedule 2 Provisions relating to association’s
assets, rights and liabilities
The proposed Schedule contains provisions with respect to the transfer to an
association that becomes incorporated under the proposed Act of the assets, rights
and liabilities of the body or bodies from which it has been constituted.
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Schedule 3 Amendment of other Acts
The proposed Schedule amends various Acts as a consequence of the enactment of
the proposed Act.Schedule 4 Savings, transitional and other
provisions
The proposed Schedule contains provisions of a savings or transitional nature
consequent on the enactment of the proposed Act.
Note: If this Bill is not modified, these Explanatory Notes would reflect the Bill as passed in the House. If the Bill has been amended by Committee, these Explanatory Notes may not necessarily reflect the Bill as passed.