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Tuesday, July 22, 2014
Saskatchewan Justice

The Co-operatives Act, 1996 provides for the incorporation of a co-operative or the limited or unlimited registration of an extra-provincial co-operative. Co-operatives are formed by their members to fulfill particular purposes, such as providing housing, food, daycare or loans. Co-operatives may carry on business outside of Saskatchewan.

At least six people may apply to incorporate by filing articles of incorporation and bylaws with the Registrar of Co-operatives. The bylaws set out the member qualifications and the roles of members, directors and officers.

The most fundamental requirement is that the association requesting incorporation be organized on a co-operative basis:

  • co-operatives must exist primarily for their members;
  • the principle of one member, one vote applies; and
  • proxy voting is prohibited (i.e., votes must be cast in person or, where the bylaws provide, except where there is a delegate structure).

The major provisions of the Act include:

  • limitations on members' liability because co-operatives have the legal status of an individual;
  • members' rights (e.g., members have the power to enact, amend or repeal bylaws, amend articles, appoint an auditor, elect and remove directors, and appeal to the courts to investigate the decisions of directors and officers);
  • directors' powers are subject to the bylaws (e.g., there must be at least five directors and the majority of directors must be Canadian residents). Bylaws are binding on members and directors;
  • rules for general and special meetings, and the rules respecting quorums and notice of meetings;
  • requirements that any surplus, after provision for reserves and dividends, is distributed to the members in proportion to their patronage or is donated to charity;
  • the right to issues shares and the right to issue shares of different classes. With respect to financing, co-operatives may be incorporated with or without share capital. The sources of capital include member shares, member loans,
  • embership fees, financial institution loans and unallocated earnings. With respect to the issuing of securities, the Act establishes a Co-operative Securities Board that reviews proposed securities issues and regulates them. The Board may also direct that the issuance of securities be subject to The Securities Act, 1988; and
  • requirements for dissolution and winding up of a co-operative, such as the remaining assets must go to charity or to another non-profit organization.


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