What is a cooperative? Rights and obligations of cooperatives in Vietnam

What is a cooperative? Rights and obligations of cooperatives in Vietnam (Internet image)

1. What is a cooperative?

According to Clause 1, Article 3 of the Cooperative Law 2012, a cooperative is a collective economic organization with co-owners and legal entity status, established voluntarily by at least 7 members who cooperate with and assist one another in production, business or job creation activities to meet their common needs on the basis of autonomy, self-responsibility, equality and democracy in management of the cooperative.

2. Rights and obligations of cooperatives in Vietnam

2.1. Rights of the cooperative in Vietnam

Cooperatives have the following rights:

- To achieve their operation objectives; to implement autonomy and self-responsibility in their operation.

- To decide on organizing their management and operation; to hire and use labor.

- To carry out production and business activities or create jobs according to registered business lines to meet the common needs of their members or member cooperatives.

- To supply and consume products, services and jobs for their members or member cooperatives and to the market while ensuring the fulfillment of obligations toward their members or member cooperatives.

- To admit new members and terminate the status of member or member cooperative.

- To increase or decrease their charter capital during operation; to mobilize capital and carry out internal credit activities in accordance with law.

- To enter into joint ventures with, associate and cooperate with domestic and foreign organizations and individuals to achieve their operation objectives.

- To contribute capital to, buy shares from and establish businesses aiming to support their activities.

- To manage, use and handle their capital, assets and funds.

- To distribute their incomes and settle their losses and debts.

- To participate in representative organizations of cooperatives or unions of cooperatives.

- To lodge complaints about or through their representatives to denounce infringements upon their rights and legitimate interests; to handle their members or member cooperatives for violations of their charter, and settle internal disputes.

2.2. Obligations of cooperatives in Vietnam

Cooperatives have the following obligations:

- To implement the charter.

- To guarantee the rights and legitimate interests of their members or member cooperatives as prescribed by this Law.

- To operate strictly according to their registered business lines.

- To perform service contracts between cooperatives and their members or unions of cooperatives and their member cooperatives.

- To implement laws on finance, tax, accounting, audit and statistics.

- To manage and use their capital, assets and funds in accordance with law.

- To manage and use land and other resources allocated or leased by the State in accordance with law.

- To sign and perform labor contracts, pay social insurance and health insurance premiums, and implement other policies for their laborers in accordance with law.

- To educate, train, retrain and provide information for their members or member cooperatives.

- To report on their activities according to regulations of the Government.

- To pay compensations as prescribed by law for damages caused by themselves to their members or member cooperatives.

(Article 9 of the Cooperative Law 2012)

Diem My

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