Setting up a European Cooperative Society
A cooperative is a business owned and operated by a group of persons or legal entities, who share both its benefits and decision-making responsibilities. Unlike traditional companies focused on maximizing profits, cooperatives aim to meet their members' needs.
If you are part of a cooperative looking to expand across EU borders, setting up a European Cooperative Society (Societas cooperativa Europaea, SCE) is an effective option. This legal structure allows you to operate in multiple countries under a single framework, and makes it easier to access larger markets, cooperate internationally, and achieve economies of scale.
Key requirements and formation
Key requirements for a European Cooperative Society (SCE) include:
- a minimum capital of EUR 30,000
- registration in the EU country where your head office is located
- membership of individuals or entities from at least two different EU countries.
The SCE can be created in three ways:
- by starting from scratch with at least five individuals or two legal entities from different EU countries
- by merging two or more existing cooperatives
- or by converting an existing cooperative that has operated in another EU country for at least two years.
Sample story
From local to European: how three cooperatives united for renewable energy
Three renewable energy cooperatives from Spain, Denmark, and Belgium wanted to collaborate on developing solar and wind projects across Europe. To simplify operations and access funding, they decided to form a European Cooperative Society (SCE). Meeting the requirement of members from at least two EU countries, they pooled EUR 30,000 in capital and registered the SCE in Belgium, where they chose to base their head office. They agreed on a governance structure with a management body overseeing daily operations and a supervisory body providing oversight. Now, as a single legal entity, they can negotiate better contracts, expand their projects, and share resources more efficiently across borders.
Governance
Voting typically follows the cooperative principle of "one member, one vote," although weighted voting is permitted in certain cases.
You must hold a general meeting at least once a year, with decisions made by a simple majority, except for changes to the internal statutes, which require a two-thirds majority. Your management structure can be either a two-tier system with a management body and a supervisory body or a one-tier system with a single administrative body, allowing for flexibility.
Staff representation
Before registering an SCE, a Special Negotiating Body (SNB) must be formed, composed of employee representatives from all countries involved. The SNB works with the SCE’s management to agree on the level and methods of employee involvement, including information-sharing, consultation, and, in some cases, participation in decision-making bodies.
Taxation
For tax purposes, an SCE is treated like any other multinational company and pays taxes in each country where it operates.
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