Important amendments to the Associations Incorporation Act 2009 (NSW) and the Associations Incorporation Regulation 2016 (NSW) commenced on 1 September 2016.
These amendments affect both existing Associations and the registration process for new Associations in NSW.
The following summary highlights the key changes:
- The Model Rules (constitution) has been amended and updated.
- NOTE: these changes will take effect automatically from 1 September 2016 and will apply to all Associations which have adopted the model rules.
- Associations can refer to the Summary of changes to the model constitution for further information about the main changes to the model constitution.
- Constitution
- An Association may adopt the model rules or prepare their own constitution. If the Association chooses to prepare their own constitution, certain matters must be included, notably:
- The maximum number of consecutive terms of office for any office bearers on the committee;
- Whether ballots can be lodged via postal or electronic means; and
- The winding up of the Association.
- If the Association’s constitution does not include clauses relating to the above points, then the relevant provision in the model constitution relating to that matter will automatically apply.
- Any constitution prepared by the Association can include additional matters; however, they must be consistent with the Act.
- An Association may adopt the model rules or prepare their own constitution. If the Association chooses to prepare their own constitution, certain matters must be included, notably:
- Official address
- The Association’s official address must now be located within NSW.
- Each time the public officer changes or the official address changes, the public officer is required to notify NSW Fair Trading.
- The official address cannot be a post office box.
- Duty of Care and Diligence
- The changes require that it is the duty of each committee member to carry out their duties for the benefit of the Association so far as practicable and with due care and diligence.
- The changes require that it is the duty of each committee member to carry out their duties for the benefit of the Association so far as practicable and with due care and diligence.
- Personal liability
- The Act now has a protection from personal liability for committee members who act in good faith when undertaking their role.
- The Act now has a protection from personal liability for committee members who act in good faith when undertaking their role.
- Financial records
- Associations must keep financial records and minutes in either electronic (which is convertible into hard copy) or hard copy form.
- Financial records must be kept for at least 5 years.
- Fees
- A new fee structure has been implemented and the new fee Schedule is available on the Fair Trading website.
- Any association wishing to update its constitution as a result of the amendments to the legislation will not be required to pay a fee to register the change for a period of 12 months until 1 September 2017.
Next Steps
We recommend that you review the constitution of your Association as a matter of urgency to determine the impact of the above changes. For a summary of changes to the model constitution see, click here.
Should you have any concerns or queries please do not hesitate to contact Anna Lewis or Bill d’Apice of Makinson d’Apice Lawyers for assistance.
