Managing Active Membership Obligations during COVID-19

09 April 2020

All co-operatives in Australia have an ‘Active Membership’ rule. Your co-op may require members to pay an annual subscription, purchase a minimum amount of goods in a year, or supply a minimum amount of labour or commodities in a year to maintain their membership in the co-operative.  

Due to the special circumstances of COVID-19, some or all your members may not be able to meet their active membership obligations under your rules.  

What can you do? 

Co-operative boards are obliged to cancel inactive members but have some options to manage this during the special circumstances of the COVID-19 pandemic.  

Boards can consider the following options to manage ‘Active Membership’ during the pandemic: 

  1. If the active membership test in your co-op is payment of a subscription, your rules may give the Board discretion to waive, extend payment time or amend the subscription for a member or generally. This can be applied to affected members. 
  2. Co-op boards may resolve to defer cancellation of an inactive member for a year if there is reasonable grounds to believe there are ‘unusual circumstances’ preventing the members meeting of active membership obligations. (see section 159 Co-operatives National Lawsection 123 Co-operatives Act 2009 (WA); section 128 Co-operatives Act 1997 (Qld)) 

How can BCCM help?

This information was prepared by the BCCM. It does not constitute legal or other professional advice and should not be relied on as such. You should obtain legal or other professional advice in relation to any particular matters or concerns that you have. The BCCM does not make any claim or representation or give any warranty in relation to the document, and is not responsible for the accuracy, currency or suitability of the information in the document.

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