Don't get deregistered: time to prepare to reregister under New Zealand's new Incorporated Societies Act

The deadline for incorporated societies in New Zealand to reregister under the Incorporated Societies Act 2022 (New Act) is fast approaching.

Societies currently registered under the Incorporated Societies Act 1908 (Old Act) must reregister under the New Act before 5 April 2026 to avoid being removed from the register and ceasing to exist. This may expose members to personal liability for the society's debts. Officers who, by inaction, allow a society to cease to exist, may also face claims from members.

Reregistering under the New Act involves a number of significant procedural steps, including preparing a new constitution and having that constitution approved at a general meeting of members. Societies are encouraged to start preparing now — if they haven't done so already — to ensure they have sufficient time to complete the process.

Societies should also take this opportunity to consider whether registration of the society as a charitable entity with New Zealand's Charities Services would be appropriate. Another key consideration will be whether existing officers wish to continue in their roles, given the New Act introduces several new director-like statutory duties on officers (including the duty to act in the society's best interests and to avoid activities that create a substantial risk of serious loss to creditors).

How to reregister under the New Act

The New Act does not provide for an automatic process of reregistration of existing incorporated societies, meaning existing incorporated societies must proactively reregister before 5 April 2026.

A reregistration application must be accompanied by the incorporated society's proposed new or amended constitution that complies with the requirements of the New Act. The New Act requires that the constitution includes (among other things) a dispute resolution process, how a person becomes, and ceases to be, a member, and the nomination of a not-for-profit entity, or a class of not-for-profit entities, to which the society's net surplus assets should be distributed on liquidation or removal from the register.

Every society is unique, with different purposes and objects. There is no one-size-fits-all constitution that complies with the New Act. This means there is no time to lose by starting the reregistration process now. To avoid any difficulties, we suggest societies draft their new or updated constitution now, share that draft on their website (or similar, such as by email), and invite feedback by a specified deadline, which should be in advance of the general meeting at which the constitution will be adopted.

Other requirements for reregistration include new membership rules, establishing a "committee" and appointing officers, and reviewing (or establishing) operational processes that comply with the New Act.

Until societies reregister under the New Act, they will continue to be governed by the Old Act.

Take note, residential development societies

Many of the 24,000 incorporated societies in New Zealand are embedded in residential property developments.

These societies — initially established by property developers to own and control common amenities — are ultimately inherited by owners when the development is completed or sold. Many of these societies are not properly advised, which can cause significant headaches when maintenance costs arise.

Developers and owners will need to reregister under the New Act to avoid their societies being removed from the register and the consequential loss of control of these common areas.

How we can help

We are currently advising a number of societies as they prepare for reregistration under the New Act, including drafting new or amended constitutions that comply with the New Act.

We are well placed to advise on the registration process under the New Act, including the associated procedural and governance requirements. We can also assist with drafting new or amended constitutions that comply with the New Act and are tailored to the bespoke requirements of your society.

We can also provide advice about the various legal structures available to your organisation, including with respect to registering as a charity.

Please get in contact if you have any questions about registration under the New Act or would like any assistance.