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An association or corporation established for the purpose of providing services on a nonprofit basis to its shareholders or members who own and control it.

The nature and functions of cooperatives differ considerably—such as purchasing cooperatives, consumer cooperatives, and marketing cooperatives.

In the context of agriculture, a farmers' cooperative refers to an organization of farmers residing in the same locale that is established for their mutual benefit in regard to the cultivation and harvest of their products, the purchase of farm equipment and supplies at the lowest possible cost, and the sale of their products at the maximum possible price.

The term cooperative also signifies the ownership of an apartment building by a nonprofit corporation that holds title to it and the property upon which it is situated. Stock in the corporation is allotted among the apartment units on the basis of their relative value or size. The right of occupancy to a particular apartment is granted to each cooperative member, who purchases the shares assigned to the desired unit. The member subsequently receives a long-term proprietary lease to that unit. The rent payable pursuant to the lease is that member's proportionate share of the expenses the corporation incurs in operating the cooperative—such as insurance, taxes, maintenance, management, and debt service. The cooperative concept evolved in New York City during the early 1900s as a mode of accommodating the public's desire for home ownership; it subsequently expanded to other large urban centers.

In order to finance the purchase or construction of the cooperative building, the cooperative places a blanket mortgage on the property, which is pledged to support the given debt. Lenders usually are hesitant to accept an individual member's stock and proprietary lease as security for a long-term loan. The members' lien (a claim on property to satisfy a debt) on the lease would be subordinate to the blanket mortgage on the property. The purchaser of a cooperative apartment usually must have sufficient cash available to pay for the stock allotted to the unit he or she wishes to obtain. The initial price of the stock generally does not exceed the amount required for a down payment on a single-family residence. As cooperative members accumulate Equity (the value of property exceeding the total debts on it) in their stock, subsequent purchasers must either have a substantial amount of cash available or locate a seller who is willing to recoup the equity in installments over several years.

Cooperative members are also financially dependent on each other. The existence of a single blanket mortgage paid by rent receipts means that if several members default in their rent payments, the corporation might not have sufficient funds to pay a mortgage loan installment. Foreclosure will ensue in regard to the entire membership unless it acts to satisfy the default. Although special reserves and assessments are generally employed to cover such a contingency, the available funds might be inadequate to prevent default.


n. an association of individual businesses, farmers, ranchers, or manufacturers with similar interests, intending to cooperate in marketing, shipping and related activities (sometimes under a single brand name) to sell their products efficiently, and then share the profits based on the production, capital or effort of each. "Sunkist" oranges is an example of a large cooperative. Cooperatives include dairy milk producers, cotton gins, and thousands of other enterprises of all sizes. There are also cooperatives in which consumers form retail outlets like grocery stores and share the profits based on the amount of patronage of each member, but they have found it difficult to compete with the giant supermarket chains.


noun alliance, association, collective, communal business establishment, communal society, commune, concurrent effort, federation, guild, joint action, joint operation, joint possession, partnership, teamwork, union
See also: ancillary, associated, beneficial, benevolent, coadunate, collective, common, concerted, concurrent, consensual, constructive, favorable, harmonious, joint, mutual, synergetic, united
References in periodicals archive ?
We are pleased to work with the Union Co-operative Society and contribute to the social and economic upliftment of the deserving individuals and families in need in the Emirate.
A group of Junee residents chose to purchase the local branch of the Railway and Tramway (R&T) Co-operative Society in June 1923, four months before the parent body went into liquidation.
On their part, Union Co-operative Society will provide Tanmia with detailed requirements specific to job openings, including job title, educational level and gender, for direct placement.
Plymouth and South West Co-operative Society is an independent retail co- operative owned and controlled by its more than 130,000 members.
A spokesman said this could provide a jobs lifeline for some staff at a historic Birmingham dairy, which is earmarked to close as part of the planned Midlands Co-operative Society deal.
Penlyne Castle" brand "Jamaican Blue Mountain" coffee is grown by Blue Mountain Coffee Co-Operative Society Ltd ("BMCC") of Jamaica.
The winning school will receive PS500, plus PS50 worth of Co-operative Society vouchers for the winning pupil who will also receive a frame certificate and a chance to see their card grace the shelves of Co-operative Society stores.
If the tender is submitted in the name of a Company / Co-operative society other than that of Proprietary concern, it shall be signed by a duly authorized officer, who shall produce satisfactory evidence of such authorization.
Snow White, which had a successful three-night run, was staged by Midlands Co-operative Society Repertory Company.
It's more a burden for retailers now," said Abdul Nazer, branch manager of the Sharjah Co-operative Society in Helwan, adding that the government laws are helpful to consumers.
AN ACCOUNTANT who abused his position while working for Wooldale Co-operative Society has been given a suspended prison sentence and must pay pounds 5,000 in compensation.
Mr Fitzgerald joined Midlands Co-operative Society in 1998 as retail general manager and in 2001 became the society's chief general manager.

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