If cooperative members contribute capital lower than the minimum capital prescribed in the cooperative charter?

What rights and obligations do cooperative members have?

Cooperative members have the rights and obligations specified in Article 14 and Article 15 of the 2012 Cooperative Law as follows. after:

* Member rights:

– Provided products and services by the cooperative under a service contract.

– Income is distributed according to the provisions of this Law and the charter.

– Enjoy the benefits of the cooperative.

– To attend or elect delegates to attend the member congress.

– To vote on contents under the authority of the general meeting of members according to the provisions of Article 32 of this Law.

– Stand for and nominate members of the board of directors, supervisory board or controller and other elected positions of the cooperative.

– Recommend and request the board of directors, director (general director), control board or controller to explain the cooperative’s activities; request the board of directors, supervisory board or controller to convene an extraordinary general meeting of members according to the provisions of this Law and the charter.

– Be provided with necessary information related to the cooperative’s activities; receive support for training, fostering and improving professional qualifications to serve the cooperative’s activities.

– Leave the cooperative according to the provisions of the charter.

– Contributed capital will be returned when leaving the cooperative according to the provisions of this Law and the charter.

– To be divided in the remaining value of the cooperative’s divided assets according to the provisions of this Law and the charter.

– Complain, denounce and sue according to the provisions of law.

– Other rights according to the provisions of the charter.

* Member obligations:

– Use products and services of the cooperative according to the service contract.

– Contribute in full and on time the committed capital contribution according to the provisions of the charter.

– Responsible for the debts and financial obligations of the cooperative within the scope of capital contributed to the cooperative.

– Compensate for damages caused by you to the cooperative according to the provisions of law.

– Comply with the cooperative’s charter and regulations, resolutions of the general meeting of members and decisions of the cooperative’s board of directors.

– Other obligations according to the provisions of the charter.

How is the capital contribution of cooperative members regulated?

Cooperative members contribute capital to the cooperative according to the provisions of Article 17 of the 2012 Law on Cooperatives as follows:

– For cooperatives, members’ capital contributions shall comply with the agreement and the provisions of the charter but must not exceed 20% of the cooperative’s charter capital.

– The term, form and level of charter capital contribution are according to the provisions of the charter, but the time limit for full capital contribution does not exceed 06 months from the date the cooperative is granted a registration certificate.

– When contributing enough capital, members will be issued a capital contribution certificate by the cooperative.

– The order and procedures for granting, re-issuing, changing and revoking capital contribution certificates are prescribed by the charter.

Pursuant to the above regulations, capital contributions contributed by cooperative members to the cooperative are implemented according to the agreement but are limited to no more than 20% of the cooperative’s charter capital and the capital contribution period is prescribed not to exceed 06 months from the date the cooperative is granted a registration certificate or from the date of admission.

Can a cooperative member who contributes capital less than the minimum level in the charter become a cooperative member?

– According to Clause 1, Article 16 of the 2012 Law on Cooperatives, the provisions on termination of cooperative membership are as follows;

Membership is terminated when one of the following cases occurs:

+ A member who is an individual dies, is declared by the Court to be dead, missing, has limited or lost civil act capacity or is sentenced to imprisonment according to the provisions of law;

+ Household members do not have a legal representative as prescribed by law; members are legal entities that are dissolved or bankrupt;

+ The cooperative is dissolved or goes bankrupt;

+ Members voluntarily leave the cooperative;

+ Member is expelled according to the provisions of the charter;

+ Members do not use products or services for a continuous period of time as prescribed by the charter but not more than 03 years. For job creation cooperatives, members do not work continuously for a period of time as prescribed by the charter but not more than 02 years;

+ At the time of commitment to fully contribute capital, members do not contribute capital or contribute capital lower than the minimum capital prescribed in the charter;

+ Other cases prescribed by the charter.

– Accordingly, the authority to decide to terminate cooperative membership is carried out according to Clause 2, Article 16 of the 2012 Law on Cooperatives as follows:

+ For the cases specified in Points a, b, c, d and e, Clause 1 of this Article, the Board of Directors shall decide and report to the nearest general meeting of members;

+ For the cases specified in Points dd, g and h, Clause 1 of this Article, the Board of Directors submits to the general meeting of members for decision after obtaining the opinion of the Supervisory Board or Controller.

– The settlement of rights and obligations of members in case of termination of membership status shall be carried out in accordance with the provisions of this Law and the charter.

Thus, according to the above regulations, in case a cooperative member contributes capital lower than the minimum capital contribution specified in the charter, his/her status as a cooperative member will have to be terminated and will fall under the authority of the board of directors to decide on termination and submit it to the general meeting of members after obtaining the opinion of the supervisory board or controller.