Purpose of the legislation

• To improve the standards and operation of the legislation governing non-financial co-operatives in Victoria.
• To create a base document for core consistent co-operatives legislation in other jurisdictions around Australia.

• To provide that incorporation as a co-operative be a right available to any group wishing to have the benefits of co-operation.
• To enable co-operatives to have corporate powers equivalent to other corporations.
• To maintain the principle of active member control of co-operatives, including one member one vote as central to the control of co-operatives.
• To provide for co-operatives to have similar standards to those applying to corporations in dealings with, or reporting on activities concerning third parties.
• To provide similar standards of directors as those applying to directors of similar sized corporations.
• To provide co-operatives with a range of alternatives in regard to determining the optimal capital structure to best service the needs of members.
• To enable co-operatives to merge across state borders.
• To recognise interstate and overseas co-operatives trading in Victoria.
• To strengthen the Registrar's powers to undertake investigations and enforcement to ensure that the interests of co-operatives, their members and the public generally, are protected.

• Includes the 7 internationally recognised co-operative principles.
• Interpretation of the act to promote the co-operative principles.
• Provides for both mutual co-operatives and business co-operatives.
• Co-operatives can be formed with, or without shares (non trading co-ops only).
• Allows co-operatives outside Victoria and Australia to register in the state.
• Co-operatives have the legal capacity of a natural person.
• Members have limited liability.
• At least 5 persons required to form a co-operative.
• Individuals and corporate bodies can be members.
• Members have to be 'active' to retain membership.
• Shares only issued to 'active' members.
• Different classes of shares can be issued.
• Individual shareholding limited to 20% of the total number of shares issued.
• Share transfers require approval by the board.
• Voting relates to membership (one member one vote), not shareholding.
• Members receive disclosure statements for major decisions.
• No limit to the number of directors.
• Board can transact business outside board meetings.
• Board or members can appoint external (non member) directors.
• A co-operative can raise funds from members and non members.
• Annual independent audit of co-operatives affairs.
• Enables mergers of co-operatives within Victoria and across state borders.