Canada Cooperatives Act (S.C. 1998, c. 1)

Marginal note:Membership share ownership

5. A member is a holder of a membership share of a cooperative when, according to the members’ register of the cooperative, the member is the owner of the membership share or is entitled to be entered in the members’ register or like record of the cooperative as the owner of the membership share.

Marginal note:Investment share ownership

6. A person is a shareholder of a cooperative when, according to the securities register of the cooperative, the person is the owner of an investment share or is entitled to be entered in the securities register or like record of the cooperative as the owner of the investment share.

Marginal note:Cooperative basis

• 7. (1) For the purposes of this Act, a cooperative is organized and operated, and carries on business, on a cooperative basis if

  • (a) membership in the cooperative is open, in a non-discriminatory manner, to persons who can use the services of the cooperative and who are willing and able to accept the responsibilities of membership;

  • (b) each member or delegate has only one vote;

  • (c) no member or delegate may vote by proxy;

  • (d) interest on any member loan is limited to a maximum percentage fixed in the articles;

  • (e) dividends on any membership share are limited to the maximum percentage fixed in the articles;

  • (f) to the extent feasible, members provide the capital required by the cooperative, with the return paid on member capital not to exceed the maximum percentage specified in the articles;

  • (g) surplus funds arising from the cooperative’s operations are used

    • (i) to develop its business,

    • (ii) to provide or improve common services to members,

    • (iii) to provide for reserves or the payment of interest on member loans or dividends on membership shares and investment shares,

    • (iv) for community welfare or the propagation of cooperative enterprises, or

    • (v) as a distribution among its members as a patronage return; and

  • (h) it educates its members, officers, employees and the public on the principles and techniques of cooperative enterprise.

• Marginal note:Restrictions

  (2) Paragraph (1)(a) is subject to any restrictions on the classes of persons to which membership may be available that may reasonably relate to any business restriction set out in the articles of the cooperative and to the reasonable commercial ability of the cooperative to provide services to prospective members, as long as the restrictions are consistent with applicable laws with respect to human rights.

• Marginal note:Exception

  (3) Despite paragraph (1)(b),

  • (a) the articles of a federation may provide that the members or delegates of the federation have more than one vote;

  • (b) if, before the coming into force of this subsection, the articles of association or charter by-laws of a former Act cooperative provide that a member or delegate of the former Act cooperative has more than one vote, the articles filed under subsection 379(2) may contain the same provisions with respect to voting rights of members or delegates;

  • (c) any provision referred to in paragraph (b) is deemed to be contained in the articles of the cooperative until it complies with subsection 379(2); and

  • (d) the articles of a cooperative may provide that subject to the conditions stated in the articles, a cooperative entity may have more than one vote in a cooperative.