Greater clarity and protection for incorporated societies passes into law

The Incorporated Societies Bill, which has passed its third reading in Parliament, updates the legal, governance and accountability settings for incorporated societies, modernising the regime and replacing the Incorporated Societies Act 1908.

Incorporated societies are incredibly diverse, and many have longstanding roles in their communities, with activities covering culture, sport and recreation, animal protection, religion, employment, politics, education, health and welfare.

The modernised law keeps the best of the 1908 Act, collates useful case law in one place and fills in gaps where the rules are unclear.

Key changes include:

• Listing the matters that must be included in a society’s constitution (including internal dispute resolution procedures)
• Clearly setting out officers’ duties (derived from case law)
• Prescribing External Reporting Board (XRB) accounting standards for larger societies’ financial reporting.

The Bill also sets out external dispute resolution and judicial review mechanisms available to members of societies, and creates sector-specific offences.

There is now a period of up to 18 months for the necessary regulations to be prepared and consulted on, before the new regime will enter into force. More information will be available on the Incorporated Societies Register website in due course.

Incorporated Societies Register(external link) — Companies Office Website

Incorporated Societies Bill 2021(external link) — New Zealand Legislation website

Read the Minister’s press release(external link) — Beehive website