Starting a Cooperative

A  cooperative is a distinct type of organization collectively owned and democratically controlled by its members to satisfy their common economic, social or cultural needs and operates under cooperative principles.

Cooperative principles

1. Voluntary and open membership;
2. Democratic member control
3. Member economic participation
4. Autonomy and independence
5. Education, training and information
6. Cooperation among cooperatives
7. Concern for community

Types of Cooperatives

There is a wide range of traditional cooperatives operating in Manitoba. Each provides different services to meet the varying needs their members. Types of cooperatives include marketing, retail supply, utilities, cable television, agricultural services, fish marketing, child care, farmers markets, and community service.

Workers and housing cooperatives while built on the traditional model contain components that need to be recognized.

New Generation Cooperatives represent an emerging trend in agriculture, forestry, fishing and other industries that are supplied by producers. These are distinct types of cooperatives formed to enable members to process raw commodities. Members receive a fair price for their produce, and may also profit from marketing these value-added products.
 
Why are people choosing cooperatives?
Cooperatives are formed when people with a common interest take advantage of their pooled resources and economy of scale to undertake a business or service that will benefit all members equitably in proportion to their patronage or consumption.

INCORPORATION REQUIREMENTS

1. Three or more individuals and two or more corporations who are prepared to become incorporators.
2. Three individuals willing to act as first directors.
3. Approval of proposed name at the office of the Registrar of Cooperatives.
4. Completion of a Name Reservation at the Companies Office.
5. Completion of Articles of Incorporation.
6. Completion of by-laws
7. Preparation of an Offering Statement if required.

ASSISTANCE PROVIDED

Promotion
General information is provided on cooperatives, identification of needs and opportunities for cooperative development. Encouragement is provided to individuals, groups and organizations to develop cooperatives for community improvement and to improve the economic situation of the members.

Incorporation
Information is provided on various corporate structures and all matters necessary to submit a request for incorporation.

Training
Training of directors and members on their roles and responsibilities is provided on request.

Regulatory
Assistance may be provided to help cooperatives comply with the requirements of The Cooperatives Act and Regulations.

FINANCIAL PROGRAMS

The Co-operative Loans and Loans Guarantee Board
The Board provides loan guarantees to cooperatives. Cooperatives applying for a loan guarantee must demonstrate that:

• the funds will not be used for refinancing or payment of existing debt.
• an effort has been made to secure alternate financing at reasonable terms.
• the loan is for productive purposes.
• there is reasonable evidence of an ability to repay the loan.
• cooperative principles and good business practices are being followed.
• reasonable security is available.
• members have invested sufficient equity so their risk is at least equal to that of the guarantee.
• Cooperatives may apply to the Board if they are unable to obtain financing on reasonable terms from other
  sources.

The Cooperative Promotion Board
The Program was established to assist and encourage the development of cooperative enterprise in Manitoba. The Board awards grants:

• as awards, scholarships or bursaries for any competition or studies related to the philosophy, principles, business or affairs of cooperatives.
• to promote cooperative research, information, and education projects.
• to develop and promote cooperatives.
• to promote the general welfare of the cooperative organization

DISCLAIMER
Information contained in this document is of a general nature only and is not intended to constitute advice for any specific fact situation. Users concerned about the reliability of the information should consult directly with the source, or seek legal counsel.

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