Officially passed the Law on Cooperatives (amended)

The Law on Cooperatives (amended) consists of 12 Chapters, with 115 Articles, including general provisions; State policies on the development of cooperative groups, cooperatives, and cooperative unions; members of cooperatives and cooperative unions; establishment of cooperatives and cooperative unions; organization and management of cooperatives and cooperative unions.

One of the new and outstanding points of the Law on Cooperatives (amended) is the institutionalization of the content of 8 policies in Resolution No. 20. The Law on Cooperatives (amended) has added provisions in Chapter II on the State's policies for the development of cooperative groups, cooperatives, and cooperative unions.

Before the National Assembly voted to pass the draft law, Chairman of the National Assembly's Economic Committee Vu Hong Thanh presented a report explaining, accepting and revising the draft Law on Cooperatives (amended).

Mr. Vu Hong Thanh said, regarding members of cooperatives and cooperative unions (Chapter III), Clause 8, Article 4 stipulates that a cooperative union is an organization with legal status voluntarily established by at least 3 official member cooperatives, which is consistent with the regulation on the maximum capital contribution of each member of a cooperative union not exceeding 40% of the charter capital;

Policy - Officially passed the Law on Cooperatives (amended) — Chairman of the National Assembly 's Economic Committee Vu Hong Thanh.

In case the cooperative union has only 2 members, according to the regulations, they can only contribute a maximum of 80% of the charter capital, not ensuring that they contribute 100% of the cooperative union's charter capital.

In addition, the National Assembly Standing Committee has accepted the opinions of National Assembly deputies and supplemented regulations on conditions for economic organizations with foreign investment capital and individuals who are foreign investors to become members of cooperatives and cooperative unions, conditions for cooperatives and cooperative unions whose members are economic organizations with foreign investment capital and individuals who are foreign investors, conditions on founders, conditions on the number of members, conditions on the maximum capital contribution in cooperatives and cooperative unions.

Regarding the transfer of capital contributions of members in cooperatives and cooperative unions, due to different opinions on this content, the Standing Committee of the National Assembly sent a ballot to National Assembly deputies for their opinions. After synthesizing the ballots, the results were as follows: 251/344 opinions agreed with Option 1 (72.97%), suggesting not to regulate the transfer of capital contributions of members in cooperatives and cooperative unions.

93/344 opinions agreed with Option 2 (27.03%), proposing regulations on transferring capital contributions both within existing members of cooperatives and cooperative unions and to individuals and organizations that are not members.

Based on the results of the poll, the draft Law has been accepted and completed according to Option 1, which is the opinion of the majority of National Assembly deputies. Accordingly, the provision on the transfer of capital contributions of members in cooperatives and cooperative unions in Article 79 and a number of related provisions are removed to ensure that the true nature of cooperatives and cooperative unions is reflected as human beings, not capital partners like enterprises, avoiding the phenomenon of buying and selling capital contributions similar to joint stock companies, limited liability companies, "corporatization of cooperatives", manipulation and control by a number of individuals and organizations over the activities of cooperatives and cooperative unions, especially for cooperatives and cooperative unions that have received a lot of State support resources.

Policy - Officially passed the Law on Cooperatives (amended) (Figure 2). — Delegates voted to pass the Law on Cooperatives (amended).

Regarding the establishment of enterprises of cooperatives and cooperative unions (Article 81); capital contribution and purchase of shares to participate in enterprises (Article 82), Articles 81 and 82 stipulate that cooperatives and cooperative unions are allowed to establish enterprises, contribute capital and purchase shares to participate in enterprises with the aim of supporting the operations, association, consumption and use of products and services of cooperatives and cooperative unions, and assign the Government to prescribe the conditions for cooperatives and cooperative unions to establish enterprises, conditions for capital contribution and purchase of shares to participate in enterprises according to the policy in Resolution No. 20. The order and procedures for establishing enterprises are in accordance with the provisions of the law on enterprises.

Clauses 2 and 3 of Article 81 stipulate that in case a cooperative or cooperative union establishes an enterprise, the cooperative or cooperative union shall exercise its rights and obligations as an enterprise owner in accordance with the provisions of the law on enterprises and relevant laws;

Contracts and transactions between cooperatives, cooperative unions and established enterprises must be established and implemented independently and equally according to the conditions applicable to independent legal entities.

In addition, Clause 2, Article 82 stipulates that in cases where cooperatives and cooperative unions contribute capital or purchase shares to participate in an enterprise, the cooperatives and cooperative unions shall exercise their rights and obligations as members and shareholders of the enterprise in accordance with the provisions of the law on enterprises and relevant laws.

At Point b, Clause 2, Article 83 stipulates the principle that cooperatives and cooperative unions are not allowed to mobilize capital from within and outside members for internal lending, because this activity is similar to credit activities carried out by credit institutions according to the provisions of the law on credit institutions, requiring high and strict requirements in risk management.

In Clause 3, Article 83, the Government is assigned to detail Clause 2 of this Article on conditions for cooperatives and cooperative unions to conduct internal lending activities and prescribe loan levels, loan limits, interest rates, and handling of risks from internal lending activities .

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