Associations Incorporation Act 2015

The Act defines several key terms in section 3. An ‘incorporated association’ is an association that is, or is taken to be, incorporated under the Act. An ‘officer’ includes not only management committee members but also any person who makes or participates in decisions affecting a substantial part of the association’s operations, who can significantly affect its financial standing, or in accordance with whose instructions the committee is accustomed to act (excluding professional advisors in a proper performance of their functions). The ‘management committee’ is the body that under the rules has power to manage the association’s affairs (s 38). A ‘special resolution’ requires at least three‑fourths of votes cast at a general meeting, with written notice given beforehand setting out the wording of the resolution (s 51). The Act establishes a tiered financial reporting system: tier 1 associations (annual revenue under $250,000, or such other prescribed amount) must prepare annual financial statements but are not automatically required to have them reviewed or audited unless members resolve or the Commissioner directs (ss 64, 69). Tier 2 associations (revenue between the tier 1 threshold and $1,000,000, or otherwise not tier 1 or 3) must prepare a financial report and have it reviewed, with audit required if members resolve or the Commissioner directs (ss 71‑72). Tier 3 associations (revenue of $1,000,000 or more) must prepare a financial report and have it audited (ss 74‑75). ‘Surplus property’ is property remaining after satisfaction of debts, liabilities and winding‑up costs, excluding books pertaining to management (s 3). The rules of an incorporated association must address the matters in Schedule 1 Division 1, including membership qualifications, management committee details, general meeting procedures, dispute resolution, and distribution of surplus property upon winding up (s 22). The Act implies a provision that surplus property can only be distributed to certain entities such as other incorporated associations, charities, or deductible gift recipients (s 24). A ‘distribution plan’ for voluntary cancellation with property must identify intended recipients and estimated amounts (s 128). Model rules are prescribed by regulation, and an association may adopt them by special resolution, which also adopts future amendments automatically (ss 26, 29). The Act also provides for amalgamation of two or more incorporated associations into a new body (Part 7), transfer of incorporation to another corporate form (Part 6), and statutory management where an association is not functioning effectively (Part 8). The Commissioner maintains a register of incorporated associations (s 161) and has broad investigation and enforcement powers (Part 14, applying Part 6 of the Fair Trading Act 2010).

The Act directly affects any association that seeks incorporation or is currently incorporated under the 2015 Act or its predecessor. This includes clubs, societies, community groups, sporting bodies, charitable organisations, political associations, and similar bodies formed for the purposes listed in section 4(a). It also affects the members of the management committee, who bear specific duties and potential liabilities (ss 39, 44‑47, 127). Officers more broadly , including senior employees who make decisions affecting a substantial part of operations , are also subject to the same duties (s 3 definition of ‘officer’). The Act imposes obligations on members: they must comply with the rules (s 21), pay fees if required, and may be subject to disciplinary procedures under the rules (Sch 1 item 18). Creditors and persons dealing with an incorporated association are affected by the limited liability of its members and committee (s 19), the ability of the association to hold property and sue or be sued (s 13), and the rules on contract validity (s 16). Reviewers and auditors appointed under the Act are affected by professional obligations (ss 78‑83), including the requirement to report significant contraventions to the Commissioner (s 83). The Commissioner and the State Administrative Tribunal have ongoing roles in oversight, dispute resolution, and enforcement (ss 154, 169‑170, 182). Existing incorporated associations under the repealed Act are automatically continued under the new Act (s 188), but they must eventually bring their rules into compliance with section 22 and Schedule 1 within three years of commencement (or longer if the Commissioner allows) (ss 198‑199). Associations formed under the repealed Act’s application process that were not completed before commencement are dealt with under the repealed Act if the applicant wishes to continue (s 190). The Act also affects other written laws: it makes consequential amendments to more than 15 other Acts (Part 17), such as the Criminal Procedure Act 2004, the Local Government Act 1995, and the School Education Act 1999, to ensure consistent definitions and references. Finally, the Act excludes incorporated associations from most of the Corporations Act 2001 (Cth) (s 152), so they are not treated as companies for general purposes, but certain provisions relating to external administration, financial services, and securities still apply in limited circumstances.

The Act imposes several core duties on officers and management committee members. Under section 44, an officer must exercise powers and discharge duties with the degree of care and diligence that a reasonable person would exercise in the association’s circumstances, having the same responsibilities. A business judgment rule provides a safe harbour if the officer acts in good faith, without a material personal interest, informs themselves appropriately, and rationally believes the judgment is in the association’s best interests (s 44(2)‑(4)). Section 45 requires officers to act in good faith in the best interests of the association and for a proper purpose. Sections 46 and 47 prohibit improper use of position or information to gain an advantage or cause detriment to the association. These duties are in addition to common law and equitable duties (s 48). Committee members and officers who have a material personal interest in a matter must disclose its nature and extent at the committee meeting and at the next general meeting (s 42), and must not be present or vote on the matter unless the interest is common to members generally or arises only because the member is an employee or belongs to a class for whose benefit the association is established (s 43). If too few members remain to form a quorum, a general meeting can be called to deal with the matter (s 43(3)). Management committee members also have a duty not to incur debts when the association is insolvent or would become insolvent, subject to defences including reasonable belief in solvency, reliance on competent advisers, illness, or taking all reasonable steps to prevent the debt (s 127). The Act grants members various rights: they are entitled to a copy of the rules upon becoming a member and at any time upon request without charge (s 36), to inspect up‑to‑date rules (s 35), to inspect and copy the register of members subject to any rule requiring a statutory declaration as to purpose (s 54), to request a copy of the register (s 56), to inspect the record of office holders (s 58), and to receive notice of and attend general meetings (Sch 1 item 2). Members have the right to vote on special resolutions (s 51), to call a general meeting if a specified percentage of members require it (Sch 1 item 10), and to participate in meetings remotely if the rules allow or are silent (s 52A). The Act also gives the State Administrative Tribunal jurisdiction to determine certain disputes between members or between members and the association, and may make orders giving directions for observance of rules or declaring rights (s 182). Reviewers and auditors have rights to access books and attend general meetings (ss 85‑86). The Commissioner has powers to request copies of the register (s 55), direct convening of general meetings (s 60), and require documents relating to financial affairs (s 157).

The Act creates numerous offences, each with a specified maximum fine expressed in penalty units or a dollar amount. For example, failure to hold an annual general meeting within the required time carries a fine of $5,000 (s 50(1)) or $2,750 for exceeding the six‑month post‑year deadline (s 50(3)). A management committee member who fails to disclose a material personal interest faces a fine of $10,000 (ss 42, 43). Breach of the duty of care, good faith, or proper use of position or information also attracts a $10,000 fine (ss 44‑47). Failure to maintain financial records or retain them for seven years carries a $2,750 fine (ss 66, 67). An incorporation association that does not present financial statements or reports at the annual general meeting faces a $5,500 fine (ss 70, 73, 76). A reviewer or auditor who fails to conduct a review or audit in accordance with auditing standards, retain working papers for seven years, or give an independence declaration is liable to a $5,500 fine (ss 78‑80). Knowingly making a false or misleading statement in a document required under the Act carries a $5,000 fine (s 177). Unauthorised use of “Incorporated” in a name or title attracts a $2,000 fine (s 179). The Act provides a range of enforcement mechanisms. Part 14 applies Part 6 of the Fair Trading Act 2010 (other than Division 4A) with modifications, empowering authorised persons , the Commissioner, delegates, and designated investigators , to investigate compliance (s 172). Infringement notices may be served under the Criminal Procedure Act 2004 Part 2, subject to a 21‑day and six‑month time limit (s 173). A prosecution for any offence under the Act must be commenced within three years after the day the offence is alleged to have been committed (s 180). The Commissioner or a person authorised in writing may commence a prosecution (s 181). The Act also empowers the Commissioner to direct a special audit (s 77), require production of financial documents (s 157), and apply to the State Administrative Tribunal for appointment of a statutory manager where an association is not functioning effectively (ss 109‑110). The statutory manager takes over the functions of the management committee (s 111). Where an association fails to comply with a direction to transfer incorporation, the Commissioner may ultimately cancel incorporation under Part 10 Division 3 (s 144). The Act also provides for cancellation by the Commissioner on grounds including that the association was not eligible at incorporation, has contravened section 17, is not in operation, has failed to remedy a contravention within 60 days after notice, or if it is in the public interest (s 144). Before cancelling, the Commissioner must give the association an opportunity to show cause (ss 145‑147).

The Act is expressly designed to exclude incorporated associations from most of the Corporations Act 2001 (Cth). Section 152 declares that an incorporated association and any act or omission in relation to it are excluded matters for the purposes of Corporations Act section 5F, meaning the Corporations legislation generally does not apply. However, the exclusion is not total. The Act preserves the application of certain Corporations Act provisions: those relating to the role of an association in forming a company, registration under Chapter 5B, substantial holdings in companies, functions as a member of a corporation, securities dealings, financial markets, financial services licensing, and financial statements of licensees (s 152(2)). The Act also actively applies parts of the Corporations Act with modifications for voluntary administration, winding up, and restructuring. Sections 120, 121 and 121A declare administration, voluntary winding up, and restructuring respectively as applied Corporations legislation matters, subject to modifications set out in Schedule 3. Those modifications substitute references to a company with an incorporated association, directors with management committee members, ASIC with the Commissioner, and so on. Winding up by the Supreme Court similarly applies Corporations Act Part 5.7 with modifications (s 125). The Act also interacts with the Fair Trading Act 2010 in several ways. Section 158 extends sections 61, 112 and 113 of that Act (with modifications) to this Act, dealing with matters such as secrecy and evidentiary provisions. Section 172 applies Part 6 (Investigation and Enforcement) of the Fair Trading Act 2010, with modifications, to investigations under this Act. Transitionally, the Act interacts with the repealed Associations Incorporation Act 1987. Existing incorporated associations are continued (s 188), and many transitional provisions preserve the application of the old Act for matters in progress such as applications for incorporation, rule alterations, winding up, and review applications (ss 190‑197). The Act also makes consequential amendments to over 15 other WA Acts (Part 17) to update references from the 1987 Act to the 2015 Act, and in some cases to add a reference to a “management” committee. The Act’s provisions on duties of officers are expressed to be in addition to, and not in derogation of, any rule of law relating to duty or liability (s 48). This means common law and equitable duties such as fiduciary obligations continue to apply, except to the extent the business judgment rule in section 44(2)‑(4) interacts with equivalent duties.

The Act was originally enacted as No. 30 of 2015, receiving Royal Assent on 2 November 2015. Sections 1 and 2 commenced on that day; the remainder of the Act commenced on 1 July 2016 by proclamation (Gazette 24 June 2016 p. 2291‑2). The first significant set of amendments came via the Associations and Co‑operatives Legislation Amendment Act 2025 (No. 9 of 2025), which received Royal Assent on 22 August 2025. Part 2 of that Act , other than sections 5, 12‑14, 26 and 28 , commenced on 23 August 2025 (s 2(c) of the 2025 Act). The amendments introduced several new provisions: section 23A, confirming that rules imposing additional requirements not inconsistent with the Act are valid; section 52A, allowing general meetings and management committee meetings to be held remotely in whole or in part using telephone or other instantaneous communication, unless the rules state otherwise; section 121A, providing for restructuring under Corporations Act Part 5.3B as an applied Corporations legislation matter; and section 136A, empowering the Commissioner to revoke approval of a distribution plan if it was based on incorrect information. Section 138A was added to allow amendment of an approved distribution plan if compliance becomes impossible or there are interpretation issues. Section 144 was completely replaced, expanding the grounds on which the Commissioner may act to cancel incorporation. Section 87 was amended to allow appointment of a reviewer or auditor for a fixed term of at least two but not more than five years (s 87(2A), (2B)). Several other amendments updated references and made minor adjustments, including changes to sections 18 (regarding registration of land vesting), 24 (adding a new category of permissible surplus property recipient , an entity endorsed as a deductible gift recipient), and 182 (adding a six‑month time limit for former members to apply to SAT). The compilation table notes that sections 5, 12‑14, 26 and 28 of the 2025 Act are uncommenced as at the compilation date. The Act includes a requirement for a statutory review of its operation and effectiveness as soon as practicable after five years from the commencement of section 184 (s 184), and the Minister may carry out further reviews after that.

The Act itself does not refer to any specific decided cases. However, it establishes a statutory framework for dispute resolution within the State Administrative Tribunal (SAT). Section 182 gives SAT jurisdiction to determine disputes that cannot be resolved under the procedure required by Schedule 1 Division 1 item 18 (which mandates a dispute resolution procedure in an association’s rules). Applications may be made by the association, a member involved in the dispute, or a former member expelled from the association (the latter must apply within six months of expulsion , s 182(1A)). SAT may make orders including giving directions for observance of rules, declaring and enforcing rights between members or between members and the association (s 182(3)). SAT may also refer a dispute to mediation (s 182(2)). Additionally, Part 13 provides for review by SAT of a range of ‘reviewable decisions’ listed in section 169. These include decisions such as refusal to incorporate, refusal to approve a change of name or alteration of rules, refusal to approve a distribution plan, and refusal to cancel incorporation under Division 2. An affected person , defined for each item in the table , may apply to SAT for review (s 170). The Act also provides for Supreme Court involvement in two key areas. Winding up of an incorporated association may be ordered by the Supreme Court on grounds set out in Schedule 4, including that the association was not eligible at incorporation, has contravened the Act, is unable to pay its debts, or that it is just and equitable to wind up (s 123). Applications may be made by the association, a member, the Commissioner, the Minister, or a creditor in the case of insolvency (s 124). During statutory management, section 119 prohibits a person from beginning or continuing a proceeding against the association in a court without leave of the Supreme Court, and the Commissioner must be given at least 10 days’ notice of any application for leave. No details of actual litigation are provided in the legislative text, so it is not possible to name specific cases. Nonetheless, the Act clearly anticipates that both SAT and the Supreme Court will be active in resolving disputes and overseeing the winding up and administration of incorporated associations.

Several provisions in the Act pose particular risk for the unwary. First, section 39 prohibits a person who has been convicted of certain indictable offences or fraud‑related offences (with a minimum three‑month imprisonment) from accepting appointment or acting as a member of a management committee without leave of the Commissioner. This restriction lasts five years from conviction or release from custody (s 40). An association that unknowingly appoints a disqualified person may face administrative consequences. Second, section 127 creates an offence for management committee members if the association incurs a debt when insolvent or when there are reasonable grounds to expect insolvency. This is akin to insolvent trading offences for company directors. The defences are limited , relying on a competent person for solvency information, illness or good reason for non‑participation, or taking all reasonable steps to prevent the debt. Committee members of even small associations must be vigilant about the association’s financial position. Third, section 30(6) provides that an alteration of rules does not take effect until a notice, certificate and consolidated copy are lodged with the Commissioner within one month (or longer if allowed). A common mistake is to assume that a special resolution alone is sufficient; the alteration is ineffective until lodgment occurs. Section 31 and 33 impose additional approval requirements for changes of name, objects, or surplus property distribution clauses , again, not effective until the Commissioner approves. Fourth, section 24 implies a restriction on distribution of surplus property on winding up. An association cannot simply distribute surplus to members; it must go to specified categories of entities such as other incorporated associations, charities, or deductible gift recipients. Any rule purporting to allow distribution to members otherwise would be inconsistent and overridden (s 24(2)). Fifth, the tier system catches associations with revenue over $1,000,000 and subjects them to a mandatory audit (s 75). However, the definition of revenue is to be calculated per accounting standards (s 64(4)), and the Commissioner may reclassify an association based on unusual circumstances (s 65). An association that misclassifies itself and fails to prepare an appropriate financial report risks penalties. Sixth, section 52A permits remote meetings unless the rules state otherwise. An association that wishes to require in‑person attendance must amend its rules to state otherwise, otherwise remote participation is a right. Seventh, improper use of information from the register of members is an offence (s 57) and can lead to a $10,000 fine. Even well‑intentioned use by a member for non‑association purposes (e.g., commercial or political advertising) is prohibited. Eighth, the Act requires that an association’s rules include a procedure for dispute resolution between members and the association (Sch 1 item 18). If no such procedure exists, members or expelled former members may apply directly to SAT (s 182). Ninth, transitional provisions give existing associations until three years after 1 July 2016 (about 1 July 2019) to bring rules into compliance with section 22, but that period has now expired; failure to comply results in the model rules applying to the extent of non‑compliance (s 201). Lastly, section 168 provides that no person is taken to have constructive notice of an association’s rules or objects merely because they are lodged with the Commissioner. This means a third party dealing with an association cannot be charged with knowledge of restrictions in the rules unless they have actual notice.

To comply with the Act, an incorporated association should take the following practical steps. First, ensure that the association remains eligible for incorporation at all times: it must carry on activities for a permitted purpose under section 4(a), have at least six members with full voting rights (s 17(b)), and not secure pecuniary profit for members (s 17(c)). Second, the rules must address all matters in Schedule 1 Division 1 and comply with Division 2 (s 22). If the rules are not compliant, the association should amend them using a special resolution and lodge the required documents within one month (s 30). Changes to name, objects, or surplus property distribution require prior Commissioner approval (ss 31, 33). Adopting the model rules by special resolution is a straightforward way to comply, but the association must notify the Commissioner of certain details (s 29). Third, maintain accurate registers: a register of members (s 53) and a record of office holders (s 58). Update the register within 28 days of any change. Ensure members can inspect these records, and do not use or disclose register information improperly (s 57). Fourth, keep financial records that correctly record transactions and enable preparation of true and fair financial statements (s 66), and retain those records for at least seven years (s 67). Determine the association’s tier each year: for revenue under $250,000 it is tier 1; between $250,000 and $1,000,000 it is tier 2; $1,000,000 and over is tier 3 (s 64). Prepare financial statements (tier 1) or a financial report (tiers 2 and 3) within six months after year end (ss 68, 71, 74). For tier 1, no review or audit is required unless members resolve or the Commissioner directs (s 69). For tier 2, a review is mandatory; an audit is required if members resolve or the Commissioner directs (s 72). Tier 3 associations must always have an audit (s 75). Present the financial statements or report at the annual general meeting (ss 70, 73, 76). If the Commissioner directs a special audit, comply (s 77). Appoint a reviewer or auditor who is qualified , a member of a prescribed accounting body, a registered company auditor, or someone approved by the Commissioner (s 88). The appointment must generally be by resolution at a general meeting, but the committee may appoint if no previous appointment is in effect (s 87). Fifth, hold an annual general meeting each calendar year within six months after the end of the financial year (s 50). Give proper notice of general meetings and ensure special resolutions are passed by at least three‑quarters of votes cast (s 51). Record minutes and maintain them properly. Sixth, comply with disclosure and voting rules regarding material personal interests. Any management committee member with such an interest must disclose it at the committee meeting and at the next general meeting (s 42), and must not be present or vote (s 43). Seventh, officers must exercise their powers with due care and diligence, in good faith, for a proper purpose, and not improperly use position or information (ss 44‑47). The business judgment rule can provide a defence if the officer meets the four conditions in section 44(2). Eighth, if the association wishes to wind up or cancel incorporation, follow the relevant procedures. For voluntary cancellation with property to distribute, prepare a distribution plan that complies with sections 128, 133 and 134, obtain member special resolutions, apply for Commissioner approval, implement the plan within the fixed period, and report completion to the Commissioner (ss 129‑140). For cancellation where there are no debts or surplus, apply with supporting resolutions and a management committee declaration (ss 141‑143). Ninth, cooperate with the Commissioner’s requests for information, inspection of registers (s 55), production of documents (s 157), and any directions. Finally, if a dispute arises that cannot be resolved internally, the association or affected members may apply to SAT for determination (s 182).