Significant developments in Maori governance: Waka Umanga Bill

Damian Stone, Senior Associate | Friday 8 June 2007

A draft Bill that is arguably the most significant legal development in Maori governance in recent times has been released by Te Puni Kokiri for consultation.

The draft Waka Umanga (Maori Corporations) Bill¹ provides for a new corporate entity, called a waka umanga, that will be able to be formed by tribal and non-tribal Maori collectives.

If enacted, the Bill will provide a model that is intended to meet the specific governance needs of Maori tribes and other groups that manage communal Maori assets.

Te Puni Kokiri has also released an associated Discussion Paper² on the draft Bill, which will form part of the consultation process. Over the next two months, Te Puni Kokiri will seek key stakeholders’ views on whether the draft Bill will address the needs of Maori collectives, and the practical realities Maori leaders and organisations face.

The draft Bill comprises 171 clauses and five schedules.  Specific provisions of the Companies Act are also incorporated into it.  Each of these clauses and schedules represents a significant development in the law.  The importance of this Bill cannot be overstated.

Te Puni Kokiri is seeking written submissions on the draft Bill on or before 13 July 2007.  It is important that you and your organisation have your say.  Any submissions made are likely to influence the final form of the draft Bill that will be introduced into Parliament.

In this Update we provide a summary of the key provisions of the draft Bill and the specific areas that Te Puni Kokiri is seeking feedback on.

Summary of key provisions

These relate to:

• formation and registration;
  
  
• governance, management and accountability;
  
  
• associated entities and subsidiaries;
  
  
• dispute resolution and judicial intervention;
  
  
• voluntary administration and liquidation; and
  
  
• registration of existing entities.

Formation and registration

The draft Bill provides for two types of waka umanga.  Those established by tribal groups will be known as waka pu, while those established by Maori associations will be known as waka tumaha.  Waka pu will also have the ability, in certain circumstances, to seek recognition as the legitimate representative of their tribal group. 

A proposed waka umanga must appoint representatives to lead the formation process and develop a charter³ for the waka umanga. 

Waka umanga will be registered on the Register of Waka Umanga, administered by the Registrar of Waka Umanga. 

Governance, management and accountability

Waka umanga will have a runanganui, consisting of at least three governors, who will be responsible for exercising the powers and performing the duties of the waka umanga under the Bill and the charter.

The duties of governors include acting in good faith, with honesty and with integrity.  Governors must also disclose any conflicts of interest.  There is some uncertainty in the draft Bill as to the extent of these duties and disclosure obligations.

Other specific provisions include those relating to major transactions, protected assets, and the policy behind distributions to registered members of the waka umanga.  The waka umanga will be managed by a chief executive (through his or her employees, in some instances). 

Further obligations of the runanganui include consultation and communication requirements with registered members.

The governance document requirements of waka umanga are extensive. 

In addition to the charter, each waka umanga must prepare a long-term plan, an annual plan, an annual report, an annual return, financial policies, accounting records, financial records and, in most circumstances, an audit report.

An annual meeting must be held and there are provisions for special meetings to be held at the request of the chairperson of the runanganui, the majority of the governors or 15 registered members of the waka umanga.

Associated entities and subsidiaries

The draft Bill places restrictions on waka umanga in relation to acquiring or disposing of any interest in an associated entity,⁴ or establishing or de-establishing a subsidiary.⁵  A waka umanga may only do so if it has adopted a policy on associated entities and subsidiaries in accordance with the draft Bill and the charter, and it acts in accordance with that policy. 

Each waka umanga must also have a policy relating to the appointment and remuneration of directors of associated entities and subsidiaries, and whether employees and governors may be appointed as directors. 

Each subsidiary must have a statement of intent; the content of which, and the input required by the waka umanga, are set out in schedule 3 of the draft Bill. 

Relatively onerous obligations are imposed on the waka umanga requiring it to monitor the performance of each associated entity and subsidiary at intervals of not more than three months.

Dispute resolution and judicial intervention

Informal dispute resolution processes and a description of those matters that are within the jurisdiction of the Maori Land Court are also set out in the draft Bill. 

Schedules 4 and 5 set out, respectively, optional processes for resolution of internal disputes and applications to the Maori Land Court.  Appeals from the Maori Land Court proceed to the High Court, the Court of Appeal and then the Supreme Court.

The Maori Land Court will have discretion, in some circumstances, to make certain orders in relation to the affairs and administration of a waka umanga, on the application of a wide range of parties.

Voluntary administration and liquidation

The draft Bill also makes provision for the appointment of a voluntary administrator for a waka umanga.  This is intended to allow a waka umanga that is, or may become, insolvent to be administered so as to maximise the chances of that waka umanga continuing in existence, or making a better return to members than would eventuate from an immediate liquidation.

A waka umanga may be put into liquidation by a majority of the members voting at a general meeting or by the court.  The waka umanga itself, a creditor of the waka umanga, the Registrar of Waka Umanga, or not fewer than 15 members of the waka umanga may also apply to the court for the appointment of a liquidator.

Registration of existing entities

Waka umanga will be available to existing entities as well as new entities. Specific provisions apply to the registration as waka umanga of different types of existing entities, including Maori Trust Boards, incorporated societies and trusts. 

Importantly, the draft Bill does not provide for the transfer of a Maori Trust Board, incorporated society or trust's status as a mandated iwi organisation under the Maori Fisheries Act 2004, or as a registered charitable entity under the Charities Act 2006, upon that entity becoming a waka umanga.

Provision is made for existing post-settlement governance entities (which have received Treaty of Waitangi settlement assets) and mandated iwi organisations (under the Maori Fisheries Act 2004) to become waka umanga through a specific process.  For example, tribal groups that have mandated iwi organisations and Treaty of Waitangi settlement entities will not need to comply with the requirements to appoint representatives and adopt a scheme plan where they wish to form and register a waka pu or become a recognised waka pu.

It is important existing entities of this nature review the draft Bill and consider its impact, particularly in relation to how the draft Bill allows them to become waka umanga. 

Submissions

Te Puni Kokiri is seeking feedback on the provisions of the draft Bill and on certain particular issues by 13 July 2007.

Te Puni Kokiri has requested comment on:

• the impact on your iwi or association;
  
  
• whether it addresses the problems experienced by Maori tribal groups;
  
  
• whether there are other options for addressing these problems; and
  
  
• how that different approach may work and the impact for your iwi or association.

 Te Puni Kokiri is also seeking feedback on the following specific issues:⁶

• whether the legislation is likely to assist with the formation and ongoing management of tribal entities and other Maori collectives;
  
  
• the usefulness of the waka umanga model to particular groups, whether waka pu and waka tumaha are appropriate models and if there is a need to cater for smaller groups;
  
  
• the usefulness and appropriateness of legal recognition on the terms it is currently drafted;
  
  
• how to make formation easy and effective;
  
  
• costs versus benefits in planning and consultation;
  
  
• usefulness of mandatory and optional requirements for the charter;
  
  
• overall appropriateness of governance provisions;
  
  
• workability and protection of major transaction provisions;
  
  
• whether the Financial Reporting Act standards should apply;
  
  
• appropriateness of waka umanga in designing its own internal dispute resolution processes, and appropriateness of dispute resolution processes provided;
  
  
• jurisdiction of the Maori Land Court;
  
  
• transition issues and whether existing entities are likely to transition;
  
  
• the exclusion of a Secretariat, and if a Secretariat is introduced how it should be established and relate to existing entities; and
  
  
• approach towards Maori language and tikanga issues.

Importance

The draft Bill has wide ranging and important ramifications for all Maori collectives.  We recommend you closely consider the provisions of the draft Bill, and whether they represent the best approach for you and your organisation.  We also encourage you to make a submission on the draft Bill. 

 

Bell Gully has considerable experience in Maori governance matters and can assist you to prepare a submission.

For further information, please contact your usual Bell Gully advisor or:

WELLINGTON

Damian Stone
Senior Associate

Rachael Brown
Senior Associate 

Footnotes

¹ Waka Umanga (Maori Corporations) Bill can be accessed online at http://www.tpk.govt.nz/government/consult/draft_wakaumanga.pdf

²Waka Umanga (Maori Corporations) Draft Bill: A Discussion Paper

³ The charter is intended to be similar to a company’s constitution, but compulsory.  The contents of the charter are set out, without limitation, at schedule 1 of the draft Bill.

⁴ An associated entity is an entity in which the waka umanga controls, directly or indirectly, 20% or more but not more than 50% of the voting or appointment rights.

⁵ A subsidiary of a waka umanga is an entity in which the waka umanga controls, directly or indirectly, more than 50% of the voting or appointment rights.

⁶ These issues are expanded on and framed as questions in the Discussion Paper and the Discussion Paper should be referred to in drafting submissions on the draft Bill.