In Russia, there are many opportunities for the activities of various commercial organizations. And one of the most interesting is a production type cooperative . It is fundamentally different from other similar structures and offers unique opportunities for participants.
Key concepts
For a full understanding of the topic, you need to consider the concept and signs of a production cooperative (aka an artel). It would be logical to start with a description of the features of this organization.
So, what is meant by a production type cooperative? In fact, this is one of the possible organizational and legal forms of a commercial legal entity. This form has a full legal basis, which can be found in Art. 50 Civil Code of the Russian Federation.
If you pay attention to Art. 65, you can find out that similar organizations also apply to corporate legal entities. This fact is due to two reasons:
- the founders of such an organization have the right to participate in the regulation of internal processes;
- within the framework of an artel, a higher structure management body can be organized.
Considering the signs of a production cooperative, it is worth understanding that it, like other similar organizations (societies, partnerships), is based on the principle of membership and commercial activity. But at the same time, it has a unique feature: for its formation, joint labor participation in key activities is used to a greater extent, rather than the property of the founders, although the latter also has a place to be.
Key features
If you study a number of features that a PC possesses, it will be possible to conclude that such an organization is an association of not only individuals, but also capital. These resources are used simultaneously, but a more tangible emphasis is placed on the participation of members of the artel. This fact is confirmed by the key features of a production cooperative:
- regardless of the size of the unit, participants have equal rights;
- membership is used as the main principle of the organization of the structure;
- joint implementation of production and economic activity as such is allowed;
- the regulation of internal processes is based on self-government and election;
- the structure itself is formed only in the case of a voluntary initiative of its participants;
- methods of carrying out the activities of the organization imply initiative and mutual assistance.
Thus, the signs of a production cooperative suggest that such a structure can only be formed after the voluntary agreement of future participants on the creation of a free cooperative organization.
Union format nuances
The combination of the above characteristics of the considered commercial organization indicates a constant combination of labor participation of members of the structure with the use of capital.
This information allows you to better understand the essence of the processes within such an organization.
Since one of the key elements is capital, consisting of individual units provided by participants, the activities of a production cooperative will inevitably include tasks related to profit. But at the same time, do not forget about the various individuals whose unification forms the organization itself. Each of the participants has certain interests (social, economic, etc.), which in the process of determining and completing tasks will inevitably have to be taken into account.
As a result, the following conclusion becomes obvious: the process of profit-making and the distribution of funds received are always regulated by the goals of the participants. Actually, the signs of a production cooperative include this feature of a similar commercial organization.
Legal status
If we analyze the status of such organizations, it is worth noting the uniqueness of such a form of doing business. In more detail, the organization of a cooperative makes it possible to combine many opportunities related to the realization of the freedoms, interests and rights of citizens acting as participants. It is precisely this feature that similar commercial organizations fundamentally differ from other forms of entrepreneurial activity.
The above scope of possibilities allows a member of the structure to legally exercise the following rights:
- the use of their resources for doing business;
- possession, disposal, use of property in conjunction with other persons, and not solely;
- free choice of profession and activity as a whole, as well as full-fledged labor activity within the chosen direction;
- free use of one’s own abilities for carrying out entrepreneurial activity.
All these rights are determined by the Constitution of the Russian Federation and can be fully realized within the framework of a production cooperative, which is formed in full compliance with the requirements of the law on state registration of legal entities and individual entrepreneurs.
Cooperative formation
Based on the above information, it can be concluded that such a form of entrepreneurial activity as a production cooperative is clearly relevant. Now you need to decide how it can be organized.
First of all, you need to start by registering the cooperative itself. This process is inevitable and requires a lot of attention. A full understanding of this issue will help to obtain a law on state registration of legal entities and individual entrepreneurs.
Initially, a certain number of legal entities that are potential participants must make a voluntary decision regarding the formation of such a commercial organization. After that, it is worth taking up the charter, without which the artel cannot be registered. This document should be approved at the general meeting of the founders.
It is important to take care of the name. The words “artel” or “production cooperative” will need to be added to it.
In the decision on the creation of a cooperative, which the organization members provide to the registration authority, the following information should be displayed:
- information regarding the establishment of a cooperative and the approval of its charter;
- data on the size, procedure, methods and timing of the formation of the property of the organization;
- description of the principles for the election of key bodies of the structure and the provision of voting results on key issues.
For a detailed display of information of this kind, a protocol is compiled. The final stage will be the submission to the local registration authority of the minutes of the meeting of the founders, an application drawn up in the prescribed form, as well as documentary evidence of the payment of the state fee and the charter itself.
Differences from state and municipal forms
To begin with, it is worth recalling how the production cooperative differs from such structures as municipal enterprises and not only.
First of all, it makes sense to recall the personal labor participation of members of the organization in the activities of the cooperative. Next, you need to pay attention to equality in the management of the structure. Another feature that distinguishes PCs among other organizations is the division of property into shares owned by participants.
In addition, there is also subsidiary liability of members for the debts of the cooperative. It is also important to know that, according to the current legislation, bodies of state power and local self-government should promote the development of the activities of commercial organizations of this type.
Assistance may take the form of benefits, including tax, in the provision of services and production of goods. It is also possible to provide the structure with land and non-residential property, which the cooperative can redeem if necessary. Moreover, government agencies can provide artisans with access to the information necessary for full-fledged activities.
If we consider municipal enterprises, then, first of all, it is worth noting that they are created mainly in a unitary form. The main shareholder in enterprises of this type is the state, and, as a result, they are on its balance sheet. Nevertheless, it is worth paying attention to the fact that the ownership of such organizations belongs to local municipalities, namely urban or rural settlements.
Property issue
The ownership of production cooperatives is divided into shares of members of the organization, and they are proportional to the contribution of each of them.
As for profit, it is distributed among members of the structure according to their participation in the activities of the artel. If the process of liquidation of the organization is launched, then each member will be able to pick up his share, which is calculated as a percentage.
It makes sense to pay attention to the sources of formation of the property of the organization:
- income received in the course of the activities of the artel;
- property contributions of cooperative members;
- any other sources of income that are not prohibited by applicable law.
To complete the picture, one more fact needs to be paid attention to: the property formed by the shares of the participants is the property of the cooperative, and not the shared property of the members of the artel.
Possible activities
Currently relevant legislation determines what activities are accessible and legal for a production cooperative. These are the following areas:
- construction;
- trade;
- organization of design and research work;
- various types of services, including domestic;
- production, marketing, and processing of agricultural, industrial and other products;
- mining and natural resources per se;
- the provision of marketing, legal, medical and other types of services that are not prohibited by law;
- collection and subsequent processing of secondary raw materials.
As you can see, the artel members have more than enough opportunities for active work.
The rights
The possibilities and permissible facets of the cooperative were described above. But, if you pay attention to the rights of a production cooperative, it can be argued that the key is the ability to own property and carry out business activities. Without this, the existence and development of an organization would be extremely problematic.
It makes sense to pay attention to the rights of its members. So, it is worth recalling that each participant is given the opportunity to vote at the time of the decision. And this fact does not depend on the size of the share.
Also, members of the organization are available to actively participate in the activities of the artel, receive their share of the profits, elect others and stand as candidates, request the necessary information from officials.
Possible forms of structure
There is no need to wait for a big variety. The main difference between such organizations will be the features of their activities. If we take into account the permissible forms of a production cooperative, it should be noted that such organizations can unite and form associations.
Also, if necessary, the artel can be reorganized. The legislation allows two types of transformed structures of this type:
- business company (LLC);
- business partnership (limited or full).
To initiate such a process, a positive decision of all members of the cooperative is needed.
Summary
The fact that Russian law allows for the formation of a cooperative with the union of both the labor participation of its members and the capital of the latter is clearly positive. But this form of commercial organization, unfortunately, is still not widespread due to the high subsidiary liability of participants.