Australia’s Business Council for Co-operatives and Mutuals (BCCM) has welcomed proposals to give new legal recognition to the co-op model.
A proposed amendment to the Corporations Act would include a definition of the mutual business model. BCCM, which represents over 2,000 co-ops and mutuals, believes this could bring new opportunities to the sector.
The draft legislation also includes reforms to demutualisation-enhanced disclosure provisions that affect mutual banks and friendly societies. This would allow mutually owned deposit-taking institutions to raise capital without having to face enhanced disclosure requirements, which will only apply to businesses that no longer meet the definition of a mutual entity.
The plans follow recommendations in the Independent Facilitator Review Report on Reforms for Cooperatives, Mutuals and Member-owned Firms, released in November 2017.