The rules are one of the most important documents any co-operative will create. The rules form the basis of everything a co-operative does, so taking time to be thorough, thinking them through and getting them right will pay dividends.
The rules form a binding contract between the co-operative and its members. All members and office holders of the co-operative must agree to follow the rules.
The rules provide the foundation for the way in which a co-operative is to operate. They include information on (but are not limited to):
- primary activity or activities;
- active membership requirements;
- qualifications for membership and directors;
- procedures to admit new members;
- how shares and fundraising will be handled (if any);
- any fines for breaking the rules;
- voting procedures;
- how surplus funds can be dealt with; and
- financial reporting and auditing requirements.
Rules passed by special resolution must be lodged with the Registrar as part of applying for registration of the co-operative.