Legal representatives of cooperatives and cooperative unions in Vietnam

Legal representatives of cooperatives and cooperative unions in Vietnam

Pursuant to Article 11 of the Law on Cooperatives 2023 (taking effect on July 1, 2024), regulations on legal representatives of cooperatives and cooperative unions are as follows:

- The legal representative of a cooperative or cooperative union is the person that, on behalf of the cooperative or cooperative union, exercises and performs the rights and obligations in its transactions, acts as the plaintiff, defendant or person with relevant interests and duties before a court or arbitral tribunal, and performs other rights and obligations as prescribed by law.

- A cooperative or cooperative union may have one or several legal representatives. The quantity, position, rights and obligations of the legal representative, and division of rights and obligations amongst legal representatives (in case there are several legal representatives) shall be specified in the charter of the cooperative or cooperative union.

- A cooperative or cooperative union shall have at least one legal representative residing in Vietnam.

In case a cooperative or cooperative union has the only one legal representative but this representative fails to perform or is unable to perform his/her rights and obligations, and does not authorize any person to do so within 30 days, the cooperative or cooperative union shall convene the General Meeting of Members (GMM) to elect a new legal representative within 15 days from the expiration of the abovementioned period.

- The court and other proceeding authorities are entitled to appoint the legal representative to participate in proceedings as prescribed by law.

Legal representatives of cooperatives and cooperative unions in Vietnam (Internet image) 

Rights of cooperatives and cooperative unions in Vietnam

Pursuant to Article 9 of the Law on Cooperatives 2023, every cooperative or cooperative union has the right to:

- Operate in such a way to effectively achieve its set objectives and goals.

- Decide its organizational structure, management and operation; hire and use employees.

- Freely engage in any business line that is not banned by laws.

- Request its members to register their demands for products/services so as to develop and implement an appropriate plan for supply of products/services to its members.

- Supply products/services to entities other than its members after having fulfilling all obligations to and ensuring interests of its members as prescribed in its charter or relevant laws.

- Provide services and organize economic, social and cultural activities for the purposes of improving living conditions of its members and communities, and achieving sustainable development.

- Engage in implementation of policies, programs and projects on economic, cultural and social development, political security, social safety and public order, and environmental protection in residential communities.

- Admit new members and terminate membership in accordance with regulations of law on cooperatives.

- Increase or decrease charter capital during its operation.

- Raise capital in accordance with regulations of law.

- Grant internal loans as prescribed in the Law on Cooperatives 2023.

- Monitor revenues and expenses on its internal transactions separately from those on its external transactions.

- Enter into joint ventures, linkages and cooperation with domestic and foreign organizations and individuals for achieving its operational objectives.

- Make capital contribution to, purchase shares of, or establish enterprises with the aim of supporting its operations.

- Distribute its incomes and settle its losses and debts.

- Join in its representative body.

- File complaints or denunciations of acts of infringing upon its legitimate rights and interests in accordance with regulations of law; settle internal disputes and take actions against violating members in accordance with its charter.

- Exercise other rights as prescribed by law and its charter.

Obligations of cooperatives and cooperative unions in Vietnam

Pursuant to Article 10 of the Law on Cooperatives 2023, every cooperative or cooperative union is obliged to:

- Admit membership upon fulfillment of all of eligibility requirements laid down in the Law on Cooperatives 2023, its charter and relevant laws.

- Ensure legitimate rights and interests of its members in accordance with the Law on Cooperatives 2023 and its charter.

- Perform all agreements made with its members, and give priority to demands registered by its members over those of non-member entities.

- Comply with regulations of law on finance, taxation, accounting, auditing and statistics, and relevant laws.

- Manage and use its capital, assets and funds in accordance with regulations of law and its charter.

- Manage and use land and resources in accordance with regulations of law.

- Conclude and perform employment contracts, pay social insurance contributions and implement other policies for its employees in accordance with regulations of law.

- Provide education, training and re-training for its members and employees.

- Fulfill the cooperative/cooperative union registration obligations in an accurate, adequate and timely manner as prescribed in the Law on Cooperatives 2023.

- Disclose information to its members as prescribed in Article 14 of the Law on Cooperatives 2023 and make information disclosure as prescribed in relevant laws.

- Make compensation for damage caused to its members in accordance with regulations of law and its charter.

- Make, update and retain its register of official/contributing members.

- Comply with reporting regulations and update information on its operating status in accordance with regulations of law.

- Perform other obligations as prescribed by law and its charter.

Mai Thanh Loi

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