According to the Redfin real estate glossary, a certificate of occupancy is a document that verifies a building is safe to inhabit or use for commerce. It is usually issued by the zoning and building authority of the local government.
A certificate of occupancy is generally required for any new building before it can be officially opened as a residence or business. Procedures for obtaining a certificate of occupancy vary by location and building type, but almost always involve a visit by a construction expert. The expert conducts a walk-through visual inspection, and he often performs routine tests on the building's fire safety, plumbing, electrical and elevator systems as applicable.