An industry body for co-operative businesses has labeled a change in New South Wales and Victorian law a ‘watershed’ moment for the sector.
The Business Council for Co-operatives and Mutuals (BCCM) said the launch of the Co-operatives National Law (CNL) on Monday 3 March will change the way business is done in Australia’s most ‘under-recognised’ sector.
The new Co-operatives National Law (now current for NSW and Victoria) aims to reduce regulatory costs and simplify financial reporting.
Similar to the enactment of harmonised workplace health and safety laws, the new laws aims to remove the burden of having to register in multiple jurisdictions in order to do business across state and territory borders.
Melina Morrison, CEO of the BCCM said that co-ops and mutuals use a variety of legal structures. Many do choose to set up under state-based co-operative legislation but they have had to deal with a fragmented regulatory system.
Morrison said that while businesses which set up under companies law have not needed to worry about the cross state trading issue, co-operatives have had to deal with the commercial constraints of ‘crazy’ and ‘anachronistic’ laws.
Despite the legislative challenges, “co-operatives are thriving,” Morrison added. Indeed, some eight in ten Australians us a member of a co-operative or mutually owned business, and there are 1,700 registered co-operatives in Australia.
All states and territories agreed to the new laws when they signed up to the Australian Uniform Co-operative Laws Agreement, with the final jurisdiction signing in February 2012. The remaining jurisdictions are also working on introducing the new laws in their state or territory.
“We encourage the remaining jurisdictions to introduce the new laws in their state or territory as soon as possible to level the playing field for co-operative businesses, so they can focus just like any business, on their operational goals and growing markets,” Morrison said.
