The NSW Labor party branch has carried out all of the anti-corruption reforms sought by Prime Minister Kevin Rudd.
Mr Rudd's first decision after returning to the leadership five weeks ago was to order federal intervention in the NSW branch - the first action of its kind in four decades - in a bid to stamp out corruption.
Since then the NSW Independent Commission Against Corruption (ICAC) has recommended corruption charges be laid against two former NSW Labor ministers, Eddie Obeid and Ian Macdonald.
The ALP's national executive on Thursday received a report from NSW ALP Secretary Sam Dastyari confirming all of the changes sought by Mr Rudd had been put in place.
Mr Rudd's reforms include:
* a zero tolerance approach to corruption
* a ban on property developers as candidates
* independent judicial oversight of dispute resolution processes
* 50 per cent rank-and-file participation in the administrative committee
* a charter of rights and responsibilities.
It's now a condition of NSW Labor party membership "that a member must not engage in or have ever engaged in corrupt conduct", the report said.
"Existing members will be expelled and applicants will be denied membership to the party if they have been found to have engaged in such conduct."
The definition of corruption will be taken from the same 1988 laws governing ICAC.
ALP members could be suspended for bringing the party into disrepute by "being investigated for improper conduct".
Property developers will be banned from running as Labor candidates at local, state and federal elections.
The party's powerful administrative committee will be elected via a new process at the next NSW Labor conference.
Affiliated unions will elect 18 members and the remaining non-affiliated delegates will elect the remaining 18 members.
The committee would elect three independent directors with board experience to advise on governance matters and "help ensure adherence to the highest standards".
Mr Dastyari has also written to Mr Rudd, saying he's "appalled" by the allegations raised during the ICAC hearings.
"It has damaged the standing of our party ... and as a result damaged the Australian democracy," Mr Dastyari wrote.
While anyone found guilty of corruption should face the full force of the law, the ALP had "a higher responsibility to ensure that such behaviour should never be repeated," Mr Dastyari added.
Mr Rudd said he welcomed the changes.
Opposition Leader Tony Abbott earlier told reporters Mr Rudd's action was not enough.
"Mr Rudd is asking for a pardon before he has done his penance," Mr Abbott said.
"The only way to properly punish the Labor party for the corruption which has entered its heart and soul is to put it into opposition, not just in Sydney but in Canberra too."
Mr Rudd asked other state branches to consider similar changes five weeks ago.
