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How to Set up a Co-operative

Incoprorate a Cooperative in Ontario

A cooperative or “co-op” refers to an incorporated business organization owned by members sharing common needs or goals. Incorporation presents a number of advantages to its members, namely the co-op’s separate legal existence, limited liability for the members, and general agreement to basic principles on how the organization will operate.
You may choose to set up your organization as either a federal co-op under the federal Co-operatives Act or a provincial co-op under Ontario’s Co-operative Corporations Act depending on the needs of your members and your organization’s operations.

Federally incorporating your co-op requires your co-op to operate and have a fixed office in two or more provinces. Federal incorporation also requires at least three members (people over the age of 18 or corporations). To apply for federal incorporation, have a lawyer draft or review the required documents under the Co-operatives Act: forms setting out the co-op’s articles of incorporation, the address of your office and the contact information of your directors, a NUANS report confirming that your business name is available, a signed declaration that the incorporators will act as a co-op, and the $250 fee.

Provincial incorporation in Ontario only requires your co-op to have its head office and central operations in Ontario. Ontario generally mandates a minimum of five members (people over the age of 18 or corporations) to incorporate a cooperative, though worker cooperatives are only required to have 3 members. To apply for provincial incorporation, have a lawyer draft or review the required documents under the Co-operative Corporations Act: forms setting out your co-op’s articles of incorporation, a NUANS report confirming that your business name is available, and the appropriate fees ($170 for non-profit co-operatives or $350 for other co-operatives).

Nick Wright is a Toronto lawyer experienced with Co-operative corporations. Contact him now at nick[at]wrightbusinesslaw.ca to arrange a time to discuss setting up your co-operative.

This article and the contents herein are for informational purposes only and do not constitute legal advice. Readers are advised to seek legal counsel prior to acting on any matter discussed herein. We take no responsibility for any third-party sites linked, nor is the presence or absence of a link an indication of endorsement of views expressed.

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