The Incorporated Societies Act 2022 requires that all 24,000 incorporated societies in New Zealand reregister under this new Act before 5 April 2026. You can find more detail on what reregistration entails on our Information Hub.
So, what happens if a society doesn’t reregister in time? A society that fails to reregister under the new Act will cease to exist and its surplus assets will need to be distributed in accordance with its constitution. To put it plainly, this means:
- the society won’t be able to continue to operate;
- it will be as if the society was removed from the Incorporated Societies Register from 5 April 2026;
- the society will need to dispose of all of its assets, including property, in accordance with the constitution; and
- the Registrar could step in and direct how the society should distribute its assets, overriding the rights of members and committee members to make decisions on behalf of the society.
From a practical perspective, this would impact a society in many ways. For example:
- as the society no longer exists, a Bank may not allow officers to access the society’s accounts anymore or require additional information from the officers before allowing access. This could have flow on effects, for example making it difficult to pay employees; and
- contracts could be affected, for example leases or supplier agreements, as the society listed on the contractual arrangement wouldn’t exist anymore. This could make it difficult to enforce the society’s rights under the contractual arrangement, for example to assign the lease or make adjustments to the supplier agreement.
IRD Guidance on this sets out their expectations: Reregister your incorporated society to keep your IRD number
There are limited reasons why a society might still be able to reregister after the transition date – for example, if the Registrar received its application before the reregistration date, the Registrar can continue to deal with the application (i.e. it could be approved after the transition date).
What if our incorporated society doesn’t want to reregister?
The Registrar is encouraging societies that don’t want to reregister to either appoint a liquidator or apply for dissolution (see here). This gives the society more certainty around the wind up process and control over how assets are distributed (which of course needs to be done in accordance with the constitution).
We have helped a number of incorporated societies wind up and are well placed to assist should you wish to do the same – please feel free to get in touch.
What if our incorporated society wants to continue to exist?
If your society wants to continue to operate and doesn’t want to lose control of its assets, then you will need to reregister under the new Act. The biggest step in this process is preparing a new constitution that aligns with the new Act. If you’d like help with this, please feel free to get in touch with our team as we’ve helped dozens of societies with this process.
This article is not a substitute for legal advice and you should consult your lawyer about your specific situation. Please feel free to contact us at Parry Field Lawyers.
