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The Advantages of Becoming a Member of a Cooperative
Here are the three principal characteristics which distinguish a cooperative from a company:
  • The way ownership is determined
  • The way decision-making is determined
  • The way that the profits of the organization are shared

The way ownership is determined
  • Each member participates in the ownership of the cooperative by applying for the minimum number of Membership Patronage Shares as defined in the statutes and regulations of the cooperative  
  • These Shares are as such non-transferable, and can only be transferred according to the conditions and modalities that are laid out in the list of regulations of the cooperative.
  • Participating in the ownership of a cooperative gives the member the right of usage of the services offered by the cooperative. This is defined by the notion of a member owner-user, and as such constitutes the major characteristic of the cooperative.
The way decision-making is determined
  • The decision-making process in a cooperative is modeled on that of parliamentary democracy. No matter how many shares the member has or the volume of business that he or she has done with the cooperative, the rule of "one person-one vote" must be respected.
  • The way that each member participates in the decision-making process is also expressed through the election of a board of directors which administers the cooperative in the name of the members, and exercises, by virtue of that fact, the powers which have been vested in it by the Law

The way that the profits of the organization are shared
  • The surplus from operations at the end of each financial year are considered as being due to all the members, "an excess of revenue collected" or a "surplus" generated based on the prices of goods and services that were bought and sold by members at the cooperative.
  • These surpluses belong to all the members and can be wholly redistributed to them in the form of discounts or rebates. The surpluses are defined as follows:
    • "An excess of revenue collected" in a consumer cooperative, is in fact, the paying out of rebates or discounts on a prorata basis according to each member's purchases. The cooperative refunds its members a portion of their expenses in consumer goods.
    • "A surplus" in a producers and workers cooperative (since this does not result from "paying out too much" but, on the contrary, from "not paying enough"); the cooperative gives discounts on the supplies that it has bought for its members (for example, the cost of milk in a dairy cooperative), or it bonifies the salaries of its member-workers.
  • The discounts in question do not correspond to a dividend that would be collected by a  company which issues stock because:
    • Said discount is considered to be a rebate of a portion of the member's expenses which he or she has incurred in the course of their purchases of goods and services at the cooperative; and in that case, it is not considered to be income for the member for taxation purposes.
    • Said discount is considered to be an adjustment to the purchase price of goods and services supplied to the cooperative by a member of a producer's cooperative; and in that case, it is considered to be taxable income for the member.
    • Said discount is considered to be an adjustment to the salary of a member of a workers cooperative, and in that case it is also considered to be taxable income for the member.


Information taken from the "Guide pratique ORION", collection  "Gestion d'une coopérative", October 1996.