401Transfer of engagements by direction of Registrar

401 Transfer of engagements by direction of Registrar

(1) The Registrar may, with the approval of the Minister, direct a co-operative:

(a) to transfer its engagements to a co-operative approved by the Registrar; and

(b) within a period fixed by the Registrar when giving the direction, or the further period the Registrar allows, to enter into an agreement approved by the Registrar to give effect to the transfer of engagements directed.

(2) The Registrar must not give the direction to a co-operative unless the necessary grounds exist for giving the direction, as referred to in section 455.

(3) The transfer of engagements must make provision in a way approved by the Registrar for the members of the transferor co-operative who wish to do so to become members of the transferee co-operative.

(4) If a co-operative fails to comply with a direction under this section, the Registrar may elect to treat the failure as the necessary grounds:

(a) for winding up the co-operative on a certificate of the Registrar; or

(b) for appointing an administrator of the co-operative.

(5) The Registrar must notify the co-operative of the Registrar’s decision under subsection (4).

(6) The Registrar may revoke a direction under this section at any time up until the co-operative has agreed under the direction to transfer its engagements.

(7) A transfer of engagements directed under this section takes effect on a day notified by the Registrar by designated instrument.

(8) An officer of a co-operative must not:

(a) fail to take all reasonable steps to secure compliance by the co-operative with a direction given under this section; or

(b) by a wilful act or omission be the cause of a failure by the co-operative to comply with a direction given under this section.

Maximum penalty (for subsection (8)): $2,000.

Division 2 Transfer of incorporation