The Civil Proceedings Act 2011 (Qld) (CPA) amended the Associations Incorporation Act 1981 (Qld) (AIA) to try to simplify the process for incorporated associations wishing to transfer to public companies limited by guarantee or an Aboriginal and Torres Strait Islander Corporation (as the case may be).

Why transition from an incorporated association to a company limited by guarantee?

Entities which were originally incorporated as an association, but have since experienced passage of time, growth in activities and memberships, expansion across territories and an increase in commercial activities may be better suited to become a public company limited by guarantee rather than remain as incorporated under associations’ legislation.

When did the changes take place?

The new amendments were introduced on 6th December 2011.  

What changes have been introduced?

The CPA inserted Part 11A into the AIA, allowing an incorporated association to transfer its registration to a public company limited by guarantee.  

The incorporated association is required to seek the approval of the Chief Executive Officer of the Office of Fair Trading (OFT).  

The Chief Executive Officer may refuse an application if the application requirements have not been met.

How do I apply to transition my incorporated association to a company limited by guarantee?

Before applying to transition, the association should review its Rules to ensure that the rules reflect requirements under the Corporations Act 2001 (Cth) or the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (Cth) (as the case may be).

The association must lodge an application to transition. An application must:

  1. Be in the approved form;
  2. Be signed by 3 members of the association (one of which must be the President); and
  3. Be accompanied by either the association’s incorporation certificate (or in the event that the certificate has been lost, stolen or destroyed, a statutory declaration by a person authorised by the association to make the declaration).
  4. A copy of a special resolution must be made which states that:
    1. The application is approved;
    2. The authorised members have the authority to sign the application form; and
    3. Include the proposed name under which the association is proposed to be registered under.
  5. The president must provide a statutory declaration which states that:
    1. The matters in the application are true;
    2. The Act and the association’s rules have been complied with in relation to the calling and holding of a general meeting where the special resolution was made; and
    3. Any consent required under the associations’ rules have been obtained prior to the passing of that resolution.

What is the effect of a successful application?

On the transfer of the incorporation of an incorporated association, the association ceases to be an incorporated association and its name is deemed to be removed from the register from the day of transfer. The certificate evidencing the registration must be lodged with the Australian Securities and Investments Commission within 28 days.

There is no need to wind the association up, cancel its ABN or terminate its registration or endorsements. Once transferred, the organisation will not be required to reapply for any applicable tax and fundraising endorsements, as these are automatically transferred with the incorporation. Additionally, all existing employees, assets and funding agreements will transfer to the company automatically and will not be subject to duty or tax despite the change.