Production cooperatives

An enterprise is an economic entity that is established in accordance with the law to provide services, produce products, perform any work in order to meet the needs of the society and make a profit.

There are some organizational and legal forms:

1. Partnership (full, limited).

2. Society (joint-stock company, with additional responsibility, limited liability).

3. Production cooperatives.

4. Unitary enterprises.

A production cooperative is an association of persons created for the purpose of jointly managing any entrepreneurial activity, which is based on their personal labor participation. The initial capital consists of the share contributions of each of the participants. Production cooperatives should consist of five or more people. However, they may not have the status of individual entrepreneurs.

Initial contributions of all members of the cooperative do not necessarily have to be equal. However, when solving various issues, they have the same rights. The distribution of profits is made according to their labor participation. In the event of withdrawal from the cooperative, each member is entitled only to payment of the unit (its initial contribution).

Production cooperatives have the following management system:

• general meeting;
• Supervisory board;
• Executive bodies (board, chairman).

Production cooperatives give their participants the right to independently withdraw from it or transfer their personal share to another member of the cooperative. The transfer of a share to a third party is solely with the consent of the general meeting.

Exclude from the cooperative can only in the event of failure to perform their direct duties. In addition, only the general meeting can do this.

One of the most common varieties of such organizations is the agricultural production cooperative. Its activities are based on the personal labor participation of each member for the purpose of producing, processing and / or marketing agricultural products.

The supreme body is the general meeting. The amount of the contribution must be 10% of the share. The remaining amount is paid during the year. The profit resulting from the activities of the agricultural cooperative is paid to its members, depending on the degree of labor participation. At the same time (according to the legislation) no less than half of the works should be carried out by the members of the cooperative.

Unitary enterprises are a widespread organizational form. To their distinctive features, first of all, it is necessary to attribute the fact that the property belonging to them (state or municipal) is not divided in any way.

The unitary enterprise is headed by the head. It can be a director or a general director. It is appointed by the owner or authorized body. The head is the sole executive body and acts on the basis of the employment contract concluded with him. His duties include the following:

• Conclusion of contracts;
• Opening of bank accounts;
• Issue of powers of attorney;
• Drafting orders for employees of the enterprise;
• Organization of implementation of decisions of the owner of the enterprise.

In connection with the fact that the property of unitary enterprises is state or municipal, the legislation restricts their rights and opportunities. This is done in order to avoid various abuses.

Unitary enterprises can not be (according to current legislation) participants of credit institutions. Participate in the activities of commercial, non - profit organizations, as well as dispose of property manager has the right only with the consent of the owner.