Cooperative company (SCOP)

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The main features of a cooperative company (société coopérative – SCOP) include its variable capital, a variable number of partners and the absolute non-transferability of shares to third parties.

The number of partners often changes, precisely because of the variable nature of its capital.

Within the meaning of the law, a cooperative company is a commercial company.

As the law allows SCOPs considerable latitude in drafting their articles of association, the partners are free to determine the extent of their liability and how the company operates and is managed.

Who is concerned

Forming a cooperative company requires at least 2 persons. There is no legal limit on the maximum number of persons.

A cooperative company is a sensible choice for natural or legal persons who wish to:

  • diversify their business activity options;
  • form partnerships with other professionals to boost their own business activities;
  • reduce cost price and cost of sales by pooling resources.

Prerequisites

There are no legal restrictions on who can form a SCOP.

The partners – whether natural or legal persons – need not be registered as traders; the only requirement is that they possess full legal capacity to enter into a binding contract.

Costs

Setting up a SCOP entails certain costs, including:

  • the cost of publication in the Trade and Companies Register (Registre de commerce et des sociétés – RCS);
  • notary costs, if a notary's services are used (this is not a legal requirement);
  • any costs related to the issuance of administrative permits.

How to proceed

Deed of incorporation

A cooperative company can be formed by notarised deed or private deed.

The only requirement is that 2 original copies of the company's articles of association be drawn up.

In a cooperative company, liability may be limited or unlimited.

A cooperative company may be set up as a public limited company (société anonyme) or a European cooperative society governed by specific provisions in respect of its formation, capital, operation and management.

By law, certain details must be included in the articles of association, such as:

  • the name of the company and the address of its head office;
  • the purpose of the company;
  • whether liability is limited or unlimited;
  • how the share capital is or will be made up, and the minimum amount required for immediate subscription;
  • for limited-liability cooperative companies, the portion of the total capital that is accounted for by fixed capital. In this case, the share of fixed capital must be established in the articles of association.

The articles of association must be filed, in full, with the Trade and Companies Register.

Company name

The cooperative company must have a company name that is established in its deed of incorporation. It may be a distinct name or the name of the business's purpose.

The name must be different from that of any other existing company.

To find out if the company name is available, contact the RCS.

Duration

A cooperative company may be established for a limited duration or an unlimited duration.

This must be specified in the articles of association. If nothing is specified in this regard in the articles of association, the cooperative company will be considered to be established for an unlimited duration.

Conversion

The cooperative company may change its corporate form in the course of its lifetime through a decision by the partners.

A change in corporate form does not result in the dissolution of the company, or the creation of a new legal person.

The rules on mergers and "demergers", which could change the company's legal form, apply to cooperative companies.

Dissolution

A cooperative company may be dissolved by a vote taken at a meeting of partners in accordance with the provisions governing changes in the articles of association.

In the event of voluntary dissolution, the following administrative certificates must be filed:

The company may also be dissolved pursuant to a legal ruling for legitimate reasons or due to unlawful activities.

Capital

In a cooperative company, the capital is variable. There are no minimum or maximum capital requirements.

The deed of incorporation must specify how the share capital is formed and the minimum amount required for immediate subscription. In limited-liability cooperative companies, the portion of the total capital that is accounted for by fixed capital must be specified in the articles of association.

Form of company shares

The capital is made up of securities representing subdivisions of the share capital.

The company may issue registered profit shares which do not form part of the share capital.

Transfer of company shares

Shares in the company's share capital may not be transferred to third parties.

New partners are admitted to the company by increasing the share capital.

Should a partner withdraw from the company, the share capital is reduced accordingly.

Structure of the managerial bodies

Partners

Admission and withdrawal of partners

The terms and conditions governing the admission and withdrawal of partners are specified in the articles of association.

Admissions to and withdrawals from the company are recorded in the register of partners. The entries must be dated and signed by the partner in question and an administrator.

Unless specified otherwise in the articles of association, excluded partners are only entitled to the nominal value of their shares in the company.

A partner may be excluded from a cooperative company. In that case, a report presenting the facts, establishing that the partner has been excluded in accordance with the terms and conditions provided for in the articles of association, must be drawn up and signed by an administrator.

The report must be transcribed into the register of partners and a certified copy of the report must be sent to the excluded partner by registered letter within 2 days.

Unless provided for otherwise by law, any associate who has resigned or been excluded from the company shall remain personally liable to the extent of their commitment, for a period of 5 years from the date of publication of their resignation or exclusion.

A partner who has resigned or been excluded from the company may not cause the company to be dissolved.

The same applies to a deceased partner's heirs and to debtors in the event of a partner's financial collapse.

Meeting of partners

The meeting of partners is convened by the managerial body.

The company's annual financial statements are approved by the partners at a meeting of partners.

Unless otherwise specified in the articles of association, all partners have voting rights.

Decisions are taken by majority vote. The terms and conditions governing the required majority should be specified in the articles of association. However, if the articles of association say nothing on this matter, the rules prescribed for public limited companies shall apply.

The conditions establishing the validity of decisions taken at meetings of partners should be set forth in the articles of association. However, failing this, the rules prescribed for public limited companies shall apply.

Business managers

A cooperative company is administered by one or more representatives. The representatives may or may not be partners and are only liable within the scope of the duties entrusted to them.

Their appointment and powers must be declared to the RCS.

If the articles of association say nothing on the way the company should be administered, the rules prescribed for public limited companies (SA) shall apply.

Associations between cooperative companies

Cooperative companies may join together to pursue a common objective.

Associations formed in this way are a separate legal entity.

Liability

A cooperative company's liability status – limited or unlimited liability – should be specified in its articles of association.

If the articles of association say nothing in this regard:

  • the partners shall be indefinitely and jointly liable;
  • each year, one half of the company's profits and losses are shared equally among the partners, and the other half in proportion to their stake in the company.

The founding partners of a limited liability cooperative company are jointly liable for certain commitments made at the time of the company's formation, and also for any misdeeds committed at the time of the company's formation.

Obligations

Keep a register

All cooperative companies must keep a register containing:

  • the deed of incorporation of the company;
  • the names, professions and addresses of the partners;
  • the date of each partner's admission, resignation or exclusion;
  • a record of the amounts paid in or withdrawn by each partner;
  • the dates of audits and the names of the internal or statutory auditors.

Entries recording withdrawals must be signed by the partner who made the withdrawal.

Cooperative companies and oversight

Oversight by one or more internal auditors, who may or may not be partners, is compulsory, unless a statutory auditor is appointed.

Legal publications

The deed of incorporation must be filed with the Trade and Companies Register (RCS) for publication in the Electronic Compendium of Companies and Associations (Recueil électronique des sociétés et associations – RESA).

In order to register the company with the RCS, the following information about the company must be disclosed:

  • the company or trade name and, where applicable, any abbreviations used;
  • the legal form of the company;
  • the exact address of the company's head office;
  • the purpose of the company;
  • the private or business addresses of the persons authorised to manage, administer and sign on behalf of the company as legal representatives, their signing authority, the date on which they were appointed and the date on which their mandate expires and, where applicable, the position and corporate entity to which they are attached;
  • the date on which the company was formed, and its duration.

An alphabetical list of the names, professions and addresses of all partners, dated and certified as accurate by the signatories, must be filed with the Trade and Companies Register every 6 months by the managers of the company.

An extract of the deed of appointment of managers, specifying their powers, must be filed with the Trade and Companies Register within one month of their appointment.

The legal form and the name of the company must be mentioned in all deeds relating to the company. Cooperative companies are required to file annual financial statements, management reports and auditors' reports with the RCS within one month of their approval.

Accounting

Cooperative companies are required to:

  • keep an inventory;
  • produce balance sheets, profit and loss accounts and their annexes, and management reports;
  • maintain reserves.

Taxation

Cooperative companies are subject to the following fees and taxes:

Who to contact

House of Entrepreneurship

'Contact Entreprise' at the Chamber of Skilled Trades and Crafts - Luxembourg

  • Chamber of Skilled Trades and Crafts Contact Entreprise

    Address:
    2, circuit de la foire internationale L-1347 Luxembourg-Kirchberg Luxembourg
    B.P. 1604, L-1016
    Email address:
    contact@cdm.lu
    Website:
    http://www.cdm.lu/

Luxembourg Business Registers

  • Luxembourg Business Registers (LBR)

    Address:
    Luxembourg

  • Luxembourg Business Registers (LBR) Luxembourg Office

    Address:
    31, Avenue de la Gare L-1611 Luxembourg
    L-2961 Luxembourg
    Phone:
    (+352) 26 42 81
    Fax:
    (+352) 26 42 85 55
    Email address:
    helpdesk@lbr.lu
    Website:
    https://www.lbr.lu
    Open Ferme à 12h00
    Thursday:
    9h00 à 12h00, 13h30 à 16h00
    Friday:
    9h00 à 12h00, 13h30 à 16h00
    Saturday:
    Closed
    Sunday:
    Closed
    Monday:
    9h00 à 12h00, 13h30 à 16h00
    Tuesday:
    9h00 à 12h00, 13h30 à 16h00
    Wednesday:
    9h00 à 12h00, 13h30 à 16h00
    Monday-Friday from 9.00 to 12.00 and from 13.30 to 16.00 /Registration helpdesk only by appointment.

  • Luxembourg Business Registers (LBR) Diekirch Office

    Address:
    Bei der Aaler Kirch - Place Joseph Bech L-9211 Diekirch
    B.P. 20 / L-9201
    Phone:
    (+352) 26 42 81
    Fax:
    (+352) 26 42 85 55
    Email address:
    helpdesk@lbr.lu
    Website:
    https://lbr.lu
    Only on Monday by appointment.

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Related procedures and links

Procedures

Links

Further information

Créer mon entreprise

sur le site de la Chambre des métiers

Legal references

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