1998, c. 1

CANADA COOPERATIVES ACT

137. (1) The definitions ``distributing cooperative'', ``member loan'', ``person'' and ``security'' in subsection 2(1) of the Canada Cooperatives Act are replaced by the following:

``distributing cooperative''
« coopérative ayant fait appel au public »

``distributing cooperative'' means, subject to subsections 4(4) and (5), a distributing cooperative as defined in the regulations.

``member loan''
« prêt de membre »

``member loan'' means a loan required by the cooperative from its members as a condition of membership or to continue membership in the cooperative, and, for the purpose of Parts 8, 16, 17, 18.1 and 19 and subsection 163(2), a member loan is deemed to be a membership share issued at par value.

``person''
« personne »

``person'' means an individual or an entity, and includes a personal representative.

``security''
« valeur mobilière »

``security'' includes an investment share, a debt obligation of a cooperative and a certificate evidencing such a share or debt obligation and, for the purposes of section 173 and Parts 18.1 and 19, includes a membership share.

(2) Subsection 2(1) of the Act is amended by adding the following in alphabetical order:

``personal representa-
tive''
« représentant personnel »

``personal representative'' means a person who stands in place of and represents another person including, but not limited to, a trustee, an executor, an administrator, a receiver, an agent, a liquidator of a succession, a guardian, a tutor, a curator, a mandatary or an attorney.

(3) Subsection 2(3) of the Act is replaced by the following:

Minors

(3) For the purposes of this Act, the word ``minor'' has the same meaning as in the applicable provincial law and, in the absence of any such law, has the same meaning as the word ``child'' in the United Nations Convention on the Rights of the Child, adopted in the United Nations General Assembly on November 20, 1989.

138. Subsections 4(4) to (6) of the Act are replaced by the following:

Exemptions - on application by cooperative

(4) On the application of a cooperative, the Director may determine that the cooperative is not or was not a distributing cooperative if the Director is satisfied that the determination would not be prejudicial to the public interest.

Exemptions - classes of cooperatives

(5) The Director may determine that a class of cooperatives are not or were not distributing cooperatives if the Director is satisfied that the determination would not be prejudicial to the public interest.

139. Subsection 8(1) of the Act is replaced by the following:

Incorporators

8. (1) An application for incorporation of a cooperative may be made by a minimum of three persons, or by one or more cooperative entities, who intend to be members of the cooperative.

140. Subsection 12(1) of the English version of the Act is amended by striking out the word ``and'' at the end of paragraph (b), by adding the word ``and'' at the end of paragraph (c) and by adding the following after paragraph (c):

    (d) a notice that is required to be given under subsection 30(2) or 81(1) indicates that the cooperative, if it came into existence, would be in compliance with the Act.

141. (1) Subparagraphs 15(2)(a)(i) and (ii) of the Act are replaced by the following:

      (i) the designation of the classes or regional groups of members, if any, who may be represented by delegates,

      (ii) the procedure for altering classes or regional groups of members, if applicable, and

(2) Paragraph 15(2)(b) of the Act is replaced by the following:

    (b) the division of members into classes or regional groups and, if so,

      (i) the qualifications for membership in each class or regional group,

      (ii) the conditions precedent to membership in each class or regional group,

      (iii) the method, time and manner of withdrawing from a class or regional group or transferring membership from one class or regional group to another and any applicable conditions on a transfer, and

      (iv) the conditions on which membership in a class or regional group ends;

142. Paragraph 16(b) of the Act is replaced by the following:

    (b) contained undertakings by every member and the successors, assigns and personal representatives of every member to observe all the provisions of the articles and by-laws.

143. Paragraph 19(4)(a) of the Act is replaced by the following:

    (a) make an order respecting the nature and extent of the obligations and liability under the contract of the cooperative and the person who entered into or purported to enter into the contract by or on behalf of the cooperative; and

144. Subsections 20(4) and (5) of the Act are replaced by the following:

Alternate form

(4) The name of a cooperative may be set out in its articles in an English form, a French form, an English form and a French form, or a combined English and French form, so long as the combined form meets the prescribed criteria. The cooperative may use and be legally designated by any such form.

145. (1) Subsection 28(1) of the Act is amended by adding the word ``or'' at the end of paragraph (e) and by replacing paragraphs (f) and (g) with the following:

    (f) a sale, lease or exchange of all or substantially all of the property of the cooperative was not authorized.

(2) Subsection 28(2) of the English version of the Act is replaced by the following:

Exception

(2) Subsection (1) does not apply in respect of a person who has, or ought to have, knowledge of a situation described in that subsection by virtue of their relationship to the cooperative.

146. Subsection 31(3) of the Act is replaced by the following:

When records or registers kept outside Canada

(3) Despite subsection (1), but subject to the Income Tax Act, the Excise Tax Act, the Customs Act and any other Act administered by the Minister of National Revenue, a cooperative may keep all or any of its records mentioned in paragraphs (1)(a), (b), (c), (f) and (g) and (2)(a) and (b) at a place outside Canada, if

    (a) the records are available for inspection, by means of a computer terminal or other technology, during regular office hours at the registered office or another office in Canada designated by the directors; and

    (b) the cooperative provides the technical assistance to facilitate an inspection referred to in paragraph (a).

147. Subsection 32(4) of the Act is replaced by the following:

Inspection and copying of records by members, creditors and shareholders

(4) Members, creditors and shareholders of the cooperative, their personal representatives and the Director may examine the records referred to in paragraphs 31(1)(a), (b), (c) (f) and (g) during the usual business hours of the cooperative and may take extracts from the records, free of charge, or have copies of them made after payment of a reasonable fee.

148. Subsection 33(1) of the Act is replaced by the following:

Lists

33. (1) Members, shareholders and creditors of a cooperative and their personal representatives and, where the cooperative is a distributing cooperative, any other person, may request that the cooperative provide them with a list of members or shareholders, no later than ten days after the cooperative receives the affidavit referred to in subsection (2) and after payment of a reasonable fee.

149. Subsection 48(3) of Act is replaced by the following:

Participation in meeting by electronic means

(3) Unless the by-laws provide otherwise, a member or shareholder may participate in a meeting of the cooperative, in accordance with the regulations, if any, by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting, if the cooperative makes available such a communication facility.

Meeting held by electronic means

(3.1) If the directors of a cooperative, or any other person, call a meeting of the cooperative pursuant to this Act, those directors or that person, as the case may be, may determine that the meeting shall be held, in accordance with the regulations, if any, entirely by means of a telephonic, electronic or other communication facility that permits all participants to communicate adequately with each other during the meeting, if the by-laws so provide.

150. Subsection 50(3) of the Act is replaced by the following:

Order to delay calling of annual meeting

(3) Despite subsection (1), the cooperative may apply to the court for an order extending the time for calling an annual meeting.

151. (1) Subsection 51(1) of the Act is replaced by the following:

Record date

51. (1) The directors may, within the prescribed period, fix in advance a date as the record date for the determination of the members or shareholders who are entitled to receive payment of a dividend or for any other purpose except the right to receive notice of, or to vote at, a meeting.

(2) Subsections 51(3) and (4) of the Act are replaced by the following:

Record date - notice of shareholders' meetings

(3) For the purpose of determining the shareholders who are entitled to receive notice of a meeting of the shareholders, the directors may, within the prescribed period, fix in advance a date as the record date for that determination.

Record date - voting at shareholders' meetings

(4) For the purposes of determining the shareholders who are entitled to vote at a meeting of shareholders, the directors may, within the prescribed period, fix in advance a date as the record date for that determination.

(3) The portion of subsection 51(6) of the Act before paragraph (a) is replaced by the following:

If record date fixed

(6) If a record date with respect to shareholders is fixed under this section, unless notice of the date is waived by each shareholder whose name is set out in the securities register at the close of business on the day the directors fix the record date, notice of the record date must be given within the prescribed period

152. Subsection 52(1) of the Act is replaced by the following:

Notice of meetings

52. (1) Notice of the time and place of a meeting of a cooperative must be sent within the prescribed period

    (a) to each person who is entitled to vote at the meeting;

    (b) to each director; and

    (c) to the auditor of the cooperative, if any.

Exception

(1.1) In the case of a cooperative that is not a distributing cooperative, the notice may be sent within a shorter period if so specified in the articles or the by-laws.

153. (1) Subsections 58(2) and (3) of the Act are replaced by the following:

Proposals by members or directors to amend articles

(2) Any member or director may, in accordance with section 290, make a proposal to amend the articles.

Proposals by other persons to amend articles

(2.1) Any other person may, in accordance with section 290, make a proposal to amend the articles if the person

    (a) has been, for at least the prescribed period, the registered holder or the beneficial owner of at least the prescribed number of outstanding investment shares of the cooperative; or

    (b) has the support of persons who, in the aggregate, and including or not including the person that submits the proposal, have been, for at least the prescribed period, the registered holders, or the beneficial owners of, at least the prescribed number of outstanding investment shares of the cooperative.

Information to be provided

(2.2) A proposal submitted by a person described in paragraph (2.1)(a) must be accompanied by the following information:

    (a) the name and address of the person and of the person's supporters, if applicable; and

    (b) the number of investment shares held or owned by the person and by the person's supporters, if applicable, and the date the investment shares were acquired.

Information not part of proposal

(2.3) The information provided under subsection (2.2) does not form part of the proposal or of the supporting statement referred to in subsection (3) and is not included for the purposes of the prescribed maximum word limit set out in subsection (3).

Proof may be required

(2.4) If requested by the cooperative within the prescribed period, a person who submits a proposal must provide proof, within the prescribed period, that the person meets the requirements of subsection (2.1).

Proposal and statement to accompany notice of meeting

(3) A proposal submitted for consideration at a meeting must be attached to the notice of the meeting, together with, if requested by the person making the proposal, a statement in support of the proposal and the name and address of person making the proposal. The statement and the proposal must together not exceed the prescribed maximum number of words.

(2) Paragraph 58(4)(a) of the Act is replaced by the following:

    (a) the proposal is not submitted to the cooperative at least the prescribed number of days before the anniversary date of the notice of meeting that was sent to members and shareholders in connection with the previous annual meeting;

(3) Paragraph 58(4)(b) of the English version of the Act is replaced by the following:

    (b) it clearly appears that the primary purpose of the proposal is to enforce a personal claim or redress a personal grievance against the cooperative or its directors, officers, members or security holders;

(4) Paragraphs 58(4)(c) and (d) of the Act are replaced by the following:

    (c) not more than the prescribed period before the receipt of a proposal, a person failed to present, at a meeting, a proposal that, at the person's request, had been attached by the cooperative to the notice of the meeting;

    (d) substantially the same proposal was attached to a notice of meeting relating to a meeting of the cooperative held not more than the prescribed period before the receipt of the proposal and the proposal did not receive the prescribed minimum amount of support at the meeting; or

(5) Section 58 of the Act is amended by adding the following after subsection (4):

Cooperative may refuse to include proposal

(4.1) If

    (a) a person described in subsection (2.1) makes a proposal and fails to continue to hold or own the number of investment shares referred to in that subsection up to and including the day of the meeting, or

    (b) a member makes a proposal and, prior to the meeting, withdraws from membership in accordance with section 39,

the cooperative is not required to include in the notice of a meeting, or attach to it, any pro posal submitted by that person for any meet ing held within the prescribed period follow ing the date of the meeting.

154. Subsections 60(1) and (2) of the Act are replaced by the following:

Refusal to include proposal

60. (1) If a cooperative refuses to include a proposal in a notice of a meeting referred to in section 52, the cooperative must, within the prescribed period after the day on which it receives the proposal or the day on which it receives the proof of ownership under subsection 58(2.4), as the case may be, notify in writing the person submitting the proposal of its intention to omit the proposal from the notice and of the reasons for the refusal.