Chapter IV
ESTABLISHMENT OF COOPERATIVES AND COOPERATIVE UNIONS
Article 38. Founders
1. Founders of a cooperative are individuals and/or organizations that voluntarily engage in the establishment of that cooperative and shall become its official members.
Founders of a cooperative union are cooperatives that voluntarily engage in the establishment of that cooperative union and shall become its official members.
2. Founders shall mobilize and disseminate information about the establishment; develop business plan and draft charter; make preparations and perform other works necessary for convening the meeting on establishment of the cooperative or cooperative union.
3. Founders may seek consultancy and assistance in establishing the cooperative or cooperative union from business registration authority, competent authority or representative body in local area where the cooperative or cooperative union will be established.
4. Founders that are foreign-invested organizations or individuals that are foreign investors shall be required to meet market access conditions for foreign investors laid down in the Law on investment and relevant laws.
Article 39. Establishment meeting
1. The meeting on establishment of a cooperative or cooperative union shall be convened by its founder(s) with the participation of:
a) Founders that are individuals;
b) Legal representatives or authorized representatives of founders that are organizations;
c) Individuals, legal representatives or authorized representatives of other organizations that wish to become members of the cooperative or cooperative union;
d) Representatives of representative bodies may attend but not vote at the meeting, if invited.
2. The meeting on establishment of a cooperative or cooperative union shall be organized according to the following order:
a) Discuss the draft charter; list of members; business plan; management model;
b) Ratify the charter;
c) Ratify the list of members, including individuals and organizations that vote for the charter and are qualified for membership as prescribed in this Law and relevant laws.
3. Official members shall decide the following contents:
a) The business plan;
b) Election of members and Chairperson of the Board of Directors (in case of fully-organized management model) or Director (in case of simplified management model). The Board of Directors shall appoint Director (or General Director);
c) Election of members and head of the Board of Controllers (in case of fully-organized management model) or Controller (in case of simplified management model);
d) The person authorized to follow cooperative or cooperative union registration procedures and perform other tasks in establishment, organization and operation of the cooperative or cooperative union.
4. Official members and contributing members shall conduct valuation and ratify valuation results of assets contributed as capital by members as prescribed in Clause 1 Article 77 of this Law.
5. The resolution of the establishment meeting shall, inter alia, have the contents in Clause 3 of this Article and must be ratified under the majority rule. Each member shall have one vote.
Article 40. Charter of cooperatives and cooperative unions
The charter of a cooperative or cooperative union must not be contrary to this Law and relevant laws, and shall, inter alia, have the following contents:
1. Name, head office’s address; logo (if any) of the cooperative or cooperative union;
2. Business lines of the cooperative or cooperative union;
3. Qualification for membership and admission procedures;
4. Cases of membership termination and procedures, including the following conditions for membership termination:
a) Cases of expulsion of members;
b) Level of frequent use of products/services or consecutive period over which an official member fails to make labour contribution;
c) Minimum value of products/services which must be used by an official member;
5. Rights and obligations of members;
6. Management model; authority of the GMM; tasks and powers of the Board of Directors, Director (General Director) and Board of Controllers (in case of fully-organized management model) or tasks and powers of Director and Controller (in case of simplified management model);
7. Quantity, titles, rights and obligations of the legal representative; division of rights and obligations between legal representatives (if the cooperative or cooperative union has more than one legal representative);
8. The charter capital; increase/decrease in charter capital; minimum and maximum capital contributions, contribution method and time limit; valuation of contributed assets; partial or full return of stakes to official/contributing members;
9. Membership fees payable by non-contributing members, if any;
10. Methods for convening the GMM; voting at the GMM; electing delegates to attend and vote at the GMM in case the GMM is organized in the form of a delegate meeting;
11. Minimum internal transaction rate;
12. Investment, capital contribution, purchase of shares, establishment of enterprises, joint ventures or associations with other business entities;
13. Establishment of funds; contributions to funds; income distribution method;
14. Financial management, use and settlement of assets, capital, funds and losses;
15. Rules for paying remunerations, salaries, wages, bonuses and other benefits to members of the Board of Directors, Director (General Director), members of the Board of Controllers or Controller, and employees;
16. Procedures for issuance, re-issuance, replacement and revocation of certificates of capital contribution;
17. Procedures for revising the charter;
18. Actions against overdue debts of members;
19. Actions against violations against the charter and rules for settlement of internal disputes.
Article 41. Registration of cooperatives and cooperative unions
1. Registration of a cooperative or cooperative union includes registration of establishment of the cooperative or cooperative union; registration of conversion from an artel into a cooperative; registration of operation of branch, representative office or business location of the cooperative or cooperative union; and other registration and notification obligations as prescribed in this Law.
2. Registration applications shall be submitted to business registration authorities adopting one of the following methods:
a) Submit a physical application directly to the business registration authority;
b) Submit a physical application by post;
c) Submit applications through the electronic information system of the business registration authority.
3. The Government shall provide detailed regulations on business registration authorities and interconnected procedures for registration of cooperatives and cooperative unions.
4. The Minister of Planning and Investment of Vietnam shall promulgate forms of documents used in registering cooperatives and cooperative unions.
Article 42. Registration of establishment of cooperatives and cooperative unions
1. Before starting its operations, the person authorized to register the establishment of the cooperative or cooperative union (hereinafter referred to as “authorized person”) shall follow procedures for registration of its establishment with the business registration authority in charge of area where it will be located.
2. An application for registration of establishment of a cooperative or cooperative union includes:
a) The application form;
b) The charter;
c) The resolution of the establishment meeting;
d) The list of official members and contributing members;
dd) The list of legal representatives who are Vietnamese citizens, in which their personal identification numbers must be specified; the list of legal representatives who are foreigners, accompanied with copies of their legal documents;
e) The copy of the investment registration certificate as prescribed in Point b Clause 1 Article 30 of this Law;
g) The copy of the investment registration certificate for the project on establishment of a cooperative or cooperative union in case the cooperative or cooperative union is established by individuals that are foreign investors or foreign-invested organizations as prescribed in the Law on investment.
3. The authorized person shall provide adequate, truthful and accurate information prescribed in Clause 2 of this Article, and assume legal responsibility for their provided information.
4. Within 03 working days from the receipt of the application, the business registration authority shall consider the validity of the application and issue the cooperative registration certificate. In case of invalid application, the business registration authority shall request the applicant in writing to make necessary modifications. If an application is refused, a written notice indicating reasons for refusal shall be given.
Article 43. Contents of application form for registration of establishment
An application form for registration of establishment of a cooperative or cooperative union shall, inter alia, include the following information:
1. Name of the cooperative or cooperative union;
2. Head office’s address and telephone number of the cooperative or cooperative union;
3. Business lines of the cooperative or cooperative union;
4. Charter capital;
5. Number of official members and contributing members (members that are foreign investors or foreign-invested organizations must be identified);
6. Full name, signature, contact address, nationality, and personal identification number or number of legal document of the legal representative of the cooperative or cooperative union;
7. Tax registration information.
Article 44. Cooperative registration certificate
1. A cooperative registration certificate may be issued if:
a) The registered business lines are not banned;
b) The submitted application is valid;
c) Name of the cooperative or cooperative union is conformable with the provisions of this Law;
d) The application fees have been fully paid in accordance with regulations of law on fees and charges.
2. Cooperatives and cooperative unions may apply for re-issuance or replacement of their cooperative registration certificates in accordance with the Government’s regulations and pay application fees in accordance with regulations of law.
Article 45. Contents of a cooperative registration certificate
A cooperative registration certificate shall, inter alia, have the following information:
1. Name of the cooperative or cooperative union;
2. Head office’s address;
3. Identification number of the cooperative or cooperative union;
4. Charter capital;
5. Full name, contact address, nationality, personal identification number or number of legal document of the legal representative of the cooperative or cooperative union.
Article 46. Identification number of cooperatives and cooperative unions
1. Identification number of a cooperative or cooperative union is generated by the electronic information system of the business registration authority, and issued to the cooperative or cooperative union upon its establishment.
2. Each cooperative or cooperative union shall have a sole identification number which must not be issued to any other organization.
3. The identification number of a cooperative or cooperative union shall be used for fulfilling tax obligations, following administrative procedures, and performing other rights and obligations.
Article 47. Registration of revisions to cooperative registration certificate
1. A cooperative or cooperative union shall be required to follow procedures for registration of revisions to its cooperative registration certificate if there is any change in the information specified in Clauses 1, 2 and 5 Article 45 of this Law or a decrease or increase of at least 5% or at least VND 01 billion in its charter capital or when the cooperative or cooperative union undergoes reorganization. Procedures for registration of revisions:
a) Within 10 days from the occurrence of a revision to its cooperative registration certificate, the cooperative or cooperative union shall submit an application for registration of revisions to the business registration authority;
b) Within 03 working days from the receipt of the application, the business registration authority shall consider the validity of the application and issue the cooperative registration certificate. In case of invalid application, the business registration authority shall request the applicant in writing to make necessary modifications. If an application is refused, a written notice indicating reasons for refusal shall be given.
2. Procedures for registering revisions to the cooperative registration certificate under a court decision or arbitration award:
a) An application for registration of revisions to the cooperative registration certificate shall be submitted to the business registration authority within 10 days from the effective date of the court’s decision or judgment or arbitration award;
b) Within 03 working days from the receipt of the application, the business registration authority shall consider the validity of the application and issue the cooperative registration certificate in accordance with the effective court’s decision or judgment or arbitration award. In case of invalid application, the business registration authority shall request the applicant in writing to make necessary modifications. If an application is refused, a written notice indicating reasons for refusal shall be given.
3. The Government shall elaborate documents required for registration of revisions to cooperative registration certificate.
Article 48. Notification of changes in registration information of cooperatives and cooperative unions
1. A cooperative or cooperative union shall notify the business registration authority of any changes in registered information about:
a) Its business lines;
b) Tax registration information;
c) Information on official members and contributing members that are foreign-invested organizations or individuals being foreign investors.
2. Procedures for notification of changes:
a) Within 10 days from the occurrence of any change in Clause 1 of this Article, the cooperative or cooperative union shall send a written notification of change to the business registration authority;
b) Within 03 working days from the receipt of the notification, the business registration authority shall consider the validity of the notification and decide whether to accept the change. In case of invalid notification, the business registration authority shall request the cooperative or cooperative union in writing to make necessary modifications. If a notification is refused, a written notice indicating reasons for refusal shall be given.
3. Procedures for notifying changes in registration information of a cooperative or cooperative union under a court decision or arbitration award:
a) Within 10 days from the effective date of the court’s decision or judgment or arbitration award, the person that requests to make the change (the requester) shall send a notification to the business registration authority;
b) Within 03 working days from the receipt of the notification, the business registration authority shall consider the validity of the notification and accept the change in accordance with the effective court’s decision or judgment or arbitration award. In case of invalid notification, the business registration authority shall request the requester in writing to make necessary modifications. If a notification is refused, a written notice indicating reasons for refusal shall be given.
4. The Government shall elaborate documents required for notification of changes in registration information of cooperatives and cooperative unions.
Article 49. Disclosure of registration information of cooperatives and cooperative unions
1. After a cooperative registration certificate is granted to a cooperative or cooperative union, the business registration authority shall disclose registration information of that cooperative or cooperative union on its electronic information system. Information to be disclosed includes:
a) Contents of the issued cooperative registration certificate;
b) The business lines of the cooperative or cooperative union.
2. In case of registration of revisions to the cooperative registration certificate as prescribed in Article 47 of this Law or notification of changes in registration information of a cooperative or cooperative union as prescribed in Article 48 of this Law, such revisions or changes must be disclosed on the electronic information system of the business registration authority.
3. The information mentioned in Clause 1 and Clause 2 of this Article shall be disclosed for a consecutive duration of 30 days from the day on which the application or notification is accepted.
Article 50. Names of cooperatives, cooperative unions, and their branches, representative offices and business locations
1. The Vietnamese name of a cooperative or cooperative union shall contain two elements in the following order:
a) The cooperative’s name shall begin with the phrase “Hợp tác xã”. The name of a cooperative development assistance fund that operates in the form of a cooperative shall begin with the phrase “Quỹ hỗ trợ phát triển hợp tác xã”. The name of a cooperative union shall begin with the phrase “Liên hiệp hợp tác xã”;
b) The proper name shall consist of letters in the Vietnamese alphabet, the letters F, J, Z, W, digits and symbols.
2. The foreign language name of a cooperative or cooperative union is the name translated from its Vietnamese name into one of Latin-based languages. The proper name of the cooperative or cooperative union may be kept unchanged or translated into the foreign language.
3. The abbreviated name of a cooperative or cooperative union may be abbreviation of either Vietnamese name or foreign language name.
4. The name of a branch, representative office or business location of a cooperative or cooperative union shall consist of the name of that cooperative or cooperative union and the phrase “Chi nhánh”, “Văn phòng đại diện” or “Địa điểm kinh doanh” respectively.
5. When selecting its proper name, a cooperative or cooperative union must not:
a) use any name that is identical or confusingly similar to another cooperative or cooperative union’s name which is already registered nationwide;
b) use any name that infringes upon the industrial property rights with regard to trade name, brand name, or geographical indication of another organization or individual in accordance with regulations of the Law on intellectual property;
c) use the name of a state authority, the people’s military unit, political organization, socio-political organization, socio-political-professional organization, or social-professional organization as part or all of its name, unless it is accepted by that authority, unit or organization;
d) use words or symbols against the country’s history, culture, ethical values and good traditions.
6. Names of cooperatives and cooperative unions, and their branches and representative offices must be registered with business registration authorities.
7. The Government shall elaborate this Article.
Article 51. Head offices of cooperatives and cooperative unions
Head office of a cooperative or cooperative union shall be located within the territory of Vietnam, and be its mailing address.
Article 52. Seals of cooperatives and cooperative unions
1. The seal of a cooperative or cooperative union can be physical or digital as prescribed in the Law on electronic transactions.
2. Each cooperative or cooperative union shall decide the type, quantity, design and contents of its seal and the seals of its branches, representative offices and other affiliated units.
3. The management and storage of seals shall comply with the charter or regulations adopted by the cooperative or cooperative union, its branch, representative office or another affiliated unit that owns the seal. The cooperative or cooperative union shall use the seal during its operation as prescribed by law.
Article 53. Branches, representative offices and business locations of cooperatives and cooperative unions
1. A branch of a cooperative or cooperative union is its dependent unit that has some or all functions of the cooperative or cooperative union, including authorized representative. The business lines of the branch shall match those of the cooperative or cooperative union.
2. A representative office of a cooperative or cooperative union is its dependent unit that acts as an authorized representative for interests of the cooperative or cooperative union. The representative office shall not do business.
3. A business location of a cooperative or cooperative union is a place where its specific business operations are carried out.
Article 54. Provision of registration information of cooperatives and cooperative unions
1. Organizations and individuals are entitled to request business registration authorities to provide registration information of cooperatives and cooperative unions on their electronic information systems, and shall pay fees in accordance with regulations of law.
2. Business registration authorities shall fully and promptly provide information in accordance with Clause 1 of this Article.
Article 55. Registration of branches, representative offices; notification of business locations of cooperatives and cooperative unions
1. A cooperative or cooperative union is entitled to establish one or some branches and/or representative offices in an administrative division of Vietnam according to the following procedures:
a) The cooperative or cooperative union shall submit an application for registration of branch/representative office to the business registration authority in charge of the area where its branch/representative office will be located;
b) Within 03 working days from the receipt of the application, the business registration authority shall consider the validity of the application and decide whether to issue the certificate of branch/representative office registration. In case of invalid application, the business registration authority shall request the applicant in writing to make necessary modifications. If an application is refused, a written notice indicating reasons for refusal shall be given.
2. Within 10 days from the occurrence of any revision to the certificate of domestic branch/representative office registration, the cooperative or cooperative union shall submit an application for registration of revisions to the business registration authority.
3. A cooperative or cooperative union is entitled to establish its branches and/or representative offices in foreign countries. Within 30 days from the establishment date of its overseas branch or representative office, the cooperative or cooperative union shall send a written notification thereof to the business registration authority in charge of the area where it is headquartered.
4. Within 10 days from the issuance date of its decision to establish a business location, the cooperative or cooperative union shall send written notification thereof to the business registration authority in charge of the area where the business location is situated.
5. The Government shall provide specific regulations on documentation required for registration of branches/representative offices, registration of revisions thereof, and notification of business locations of cooperatives and cooperative unions.
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