Organizational structure of cooperatives and unions of cooperatives in Vietnam

What are cooperatives and unions of cooperatives?

Pursuant to Article 3 of the Law on Cooperatives 2012 stipulates:

- 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.

- A union of cooperatives is a collective economic organization with co-owners and legal entity status, established voluntarily by at least 4 cooperatives which cooperate with and assist one another in production and business activities to meet their common needs on the basis of autonomy, self-responsibility, equality and democracy in the management of the union.

Organizational structure of cooperatives and unions of cooperatives in Vietnam (Internet image)

Organizational structure of cooperatives and unions of cooperatives in Vietnam

Pursuant to Article 29 of the Law on Cooperatives 2012, the organizational structure of a cooperative or union of cooperatives comprises the general meeting of members, the Board of Directors, the Director (General Director), the Control Board or controller, in which:

(1) The general meeting of members has the highest power to issue decisions of the cooperative or union of cooperatives. General meetings of members include annual and extraordinary general meetings. A general meeting of members is held in the form of general meeting or general meeting of member deputies (below collectively referred to as general meeting of members). A general meeting has the powers and tasks prescribed in Article 32 of the Law on Cooperatives 2012.

Cooperatives or unions of cooperatives with 100 members or member cooperatives or more may hold general meetings of member deputies.

Criteria of deputies and the order and procedures for the election of deputies to participate in the general meeting of member deputies must be specified by the charter.

The number of deputies participating in a general meeting of member deputies must be specified by the charter but must be:

- At least 30% of the total number of members or member cooperatives, for cooperatives or unions of cooperatives having between 100 and 300 members or member cooperatives;

- At least 20% of the total number of members or member cooperatives, for the cooperatives or unions of cooperatives having between over 300 and 1,000 members or member cooperatives;

- At least 200 for cooperatives or unions of cooperatives having more than 1,000 members or member cooperatives.

Deputies attending a general meeting of members shall express opinions and aspirations of, and take responsibility for notification of the results of the general meeting to, all members or cooperative members they represent.

(2) The Board of Directors of a cooperative or union of cooperatives is the management body of the cooperative or union of cooperatives and is established by conference or elected, removed from office or dismissed by the general meeting of members by secret ballot. The Board of Directors comprises the chairman and members; the number of members of the Board of Directors is prescribed by the charter but must be at least 3 and at most 15.

The term of office of the Board of Directors of a cooperative or union of cooperatives must be stipulated by the charter of the cooperative or union of cooperatives, but must be at least 2 years and at most 5 years.

The Board of Directors may use the seal of the cooperative or union of cooperatives to perform the powers and tasks specified in Article 36 of this Law.

The Board of Directors of a cooperative shall hold regular meetings in accordance with the charter at least once every 3 months; the Board of Directors of a union of cooperatives shall hold regular meetings in accordance with the charter at least once every 6 months convened by the chairman of the Board of Directors or by a member of the Board of Directors authorized by the chairman of the Board of Directors.

The Board of Directors shall hold an extraordinary meeting at the request of at least one- third of the total number of its members or of the chairman of the Board of Directors, the Control Board or controller or the Director (General Director) of the cooperative or union of cooperatives.

A meeting of the Board of Directors must be conducted as follows:

- A meeting of the Board of Directors must be conducted when it is attended by at least two-thirds of the total number of members of the Board of Directors. The Board’s decisions are adopted on the principle of majority vote, each member has one vote of equal validity;

- In case of convening a meeting of the Board of Directors on a regular basis but with an insufficient number of participants as prescribed, the chairman of the Board shall convene a second meeting within 15 days from the expected date of the first meeting. After two times of convening without a sufficient number of participants, the Board shall convene an extraordinary general meeting of members within 30 days from the date of the expected date of the second meeting to review the status of member of those members who have not attended the meeting and take handling measures; the chairman of the Board of Directors shall report to the coming general meeting of members to review the status of member of the Board of Directors who have not attended the meeting and decide on the handling measure;

- The content and conclusions of the meeting of the Board of Directors must be recorded in a minutes; the meeting minutes must be signed by the chairperson and secretary of the meeting. The chairperson and secretary are jointly responsible for the accuracy and truthfulness of the minutes. For contents that the Board of Directors can not decide, it shall submit them to the general meeting of members for decision. The members of the Board of Directors may reserve their opinions which are recorded in the minutes of the meeting.

(3) The Control Board or controller shall operate independently, examine and supervise activities of the cooperative or union of cooperatives in accordance with law and its charter.

The Control Board or controller shall be elected directly by the general meeting of members among the members or representatives of member cooperatives by secret ballot. The number of members of the Control Board may be decided by the general meeting of members but must not exceed 7.

Cooperatives with 30 members or more, unions of cooperatives with 10 members or more shall elect the Control Board. For cooperatives with less than 30 members and unions of cooperatives with less than 10 member cooperatives, the establishment of the Control Board or appointment of the controller must be specified in the charter.

The head of the Control Board shall be elected directly among the members of the Control Board. The term of office of the Control Board or controller must match that of the Board of Directors.

Members of the Control Board or controller are entitled to remuneration and other necessary expenses in the course of performing their tasks.

The Control Board or controller may use the seal of the cooperative or union of cooperatives to perform its/his/her tasks.

Mai Thanh Loi

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