FA
Login- Register
If you have not registered yet, throughRegisterTake action! close
يكشنبه, 19 نوامبر 2017
Investment Guarantee Fund Co-sponsor the development of cooperation
contact of Managing
post electronic
links
Vote
Do you think the impact of the new service fund in the form of "cooperative guarantee transactions," which is about the most?

Financial support to cooperatives
Increasing competitiveness of cooperatives
Open market cooperatives

Home > Terms & Regulations > Law on Cooperation Sector 

Chapter one- The goals and general criteria of the cooperative sector

Article 1- Goals of the cooperative sector are:

1.     Establishment and provision of conditions and facilities of the work to achieve full occupation.

2.     Placing work equipment in access of persons that are able to work but lack working equipment.

3.     Preventing collection and accumulation of wealth in the hands of individuals and special groups for the realization of social justice.

4.     Preventing the government to become the ultimate employer

5.     Placement of management, capital and profits in possession of work force and encouraging direct utilization of the results of their work

6.     Preventing the monopoly,  hoarding, inflation and harming people

7.     Development and reinforcing participation and public cooperation of all groups of people

Note- The goals mentioned in this article should be through observing the requirements that govern public economic planning in any stages of development phase.

Article 2- Companies that are established by following the regulations of this law and are registered accordingly will be recognized as cooperative company.

Article 3- The government is obliged to collaborate with the cooperative sector and put in their access the necessary facilities and credits by the coordination of the Cooperation Ministry by following this law, in the template of regulations and by taking measures that would not end to the administration or intervention of the government in the cooperatives or making the government the ultimate employer.

Article 4- The government and its affiliated organizations should give priority to the cooperative sector in equal conditioning when they are assigning their plans and projects.

Article 5- The statute and article of association of any cooperative companies should include following points by observing this law:

The name and the phrase “Cooperative company”, the goals and purpose, subject, type, scope of operations, duration, head office of the operations, address, amount of registered capital, regulations in accepting membership, fundamentals, financial regulations and practice, dissolution and liquidation.

Note- The cooperatives should have Iranian nationality.

Article 6- The minimum and maximum number of members in the cooperatives is determined proportion to the capital, job opportunities, type of business activities and observing decentralization of wealth and illegal accumulation through a by-law which is passed by the Cooperative Ministry; however, in no cases, the number of cooperative company should not be less than seven persons.

Article 7- Cooperative companies and unions have independent legal entity.

Chapter two- Member

Article 7- The member in a cooperative company is a natural person or legal entity other than governmental bodies that has the qualification set forth in this law and is bound to the goals of the cooperative sector and the legal statute of that cooperative.

Note 1- In job creating cooperatives, the governmental aids are allocated to that cooperative proportion to the number of members that work in that cooperative.

Note 2- In multi-purpose cooperatives, if membership is open to all, it will be allowed to have a non-employed member; however, the board of directors and managing director should be elected from occupied employees.

Article 9- The general terms for membership at the cooperative company are:

1-    Nationality of Islamic Republic of Iran

2-    Absence of legal prevention and legal protection

3-    Purchase of minimum stocks as stipulated in the articles of association

4-    Written application letter for membership and observing the terms of the cooperative statue or article of association

5-    No membership in similar cooperative

Article 10- The members have rights to exercise their supervision rights in all affairs of the cooperative according to the contents of the article of association.

Article 11- All members are obliged to act in accordance with the duties and responsibilities that they have undertaken within the laws and regulations.

Article 12- The member is allowed to resign from cooperative membership and it can not be preventing it.

Note 1- The specialized members of the production cooperatives should inform their resignation in writing minimum six months in advance.

Note 2- If the member’s resignation from cooperative causes any loss to the cooperative he should compensate his absence.

Article 13- In following cases, a member will be expelled from the cooperative:

1-    Loss of any membership qualification set forth in this law

2-    Disregarding the terms of the statute and other legal obligations after two written notices sent by the board of directors in 15 days interval and after 15 days from the second written notice by the approval of ordinary general meeting.

3-    Committing acts that cause financial harm to the cooperative and not compensating it in one year or committing acts that would jeopardize the prestige and credit of the cooperative or lead to unhealthy competition with the cooperative.

Note- The discretion of the above-mentioned items will be upon the suggestion of any of the board of directors’ members or inspectors, and the approval of general meeting.

Article 14- In the event of a member’s death, his/her qualified heirs that bind themselves to follow the regulations of the cooperative will be recognized as the cooperative member; however, if they announce in writing that they do not intend to continue membership in the cooperative or none of them is recognized qualified, the membership will be suspended.

Note- If the number of heirs is more than the cooperative’s capacity; one or more persons with the same number of the cooperative will be recognized as members with the agreement of other heirs.

Article 15- In case of suspension of membership due to factors such as death, resignation, dissolution, expel or discharge, all his shares, claims and debts will be calculated in accordance with the terms of the article of association and contract to be converted into the cooperative’s liability and after deducting his debt, it will be paid to him or his heirs maximum within three months after deducting his debts to the cooperative.

Note- If the heirs demand to have  the share of the deceased member from the cooperative’s property and no compromise or agreement is reached, and if the transfer of the object could be possible with no large disorder or loss to the members and the cooperative, that part of the claims will be handed over to the heirs.

Chapter three- Capital

Article 16- The cooperative capital means properties and assets that are put in possession of the cooperative for its establishment or increase in the previous capital.

Article 17- The cooperative companies mean companies that all or minimum 51 percent of the capital is provided by the members; however,  ministries, organizations, governmental and affiliated or state owned companies, companies under umbrella of the government, banks, municipalities, state Islamic councils, Mostazafan Foundation and other public institutes  are  allowed to help in providing and/or increasing the cooperative capital without being a member  in the execution of clause 2, principal 43 by interest free loans or any other legitimate ways such as participation, loans, sharing the farm yields, equal shares, lease, hire-purchase, conditional purchase, sale on installment, conveyance  and transfer.

Note- In cases when the governmental bodies seek partnership in establishing cooperative companies, the share of government’s in the investment will be returned gradually within a period which is agreed by the parties in the company’s contract and one hundred percent of the capital will belong to the cooperative.

Article 18- The government is allowed to put its industrial, agricultural, service or such units that are public properties in possession of the cooperative companies in following manner by observing principals forty three and forty four of the constitution:

1-    The mentioned units are put in possession of the cooperative as provisional and temporary attachment or as long as the cooperative legally exists and the cooperative would own the benefits.

2-    If the mentioned units have qualified personnel, they will have priority in seeking membership of the cooperative.

3-    The government will be allowed to receive cash or goods from the cooperative annually through agreements for the depreciation, renovation, maintenance or development of the mentioned unit.

4-    The government is allowed to determine some requisites as the terms in observing the government’s policies in pricing and planning for the production, distribution and providing public benefits in transferring the aforementioned units and other facilities.

Article 19- In using loans and governmental financial aids, priority will be given to the cooperatives that have not received interest free loan from banks through interest-free banking operations.

Article 20- Members’ share in providing the capital for the cooperative companies is equal unless the general assembly approves that the members should provide more shares in which case, the minimum and maximum shares should be within a scope that the Cooperative Ministries have determined proportion to the type and number of cooperative members.

Article 21- Any cooperative is registered and established when minimum one third of its capital has been supplied and is assessed and submitted in cash or commodities.

Note- The cooperative members are obliged to present their unpaid shares within the time set forth in the articles of association or statute.

Article 22- The cooperative members are allowed to transfer their shares to other members or new qualified members by observing the regulations of this law.

Article 23- The financial responsibilities of the members in the cooperative companies is limited to the amount of their shares unless another arrangement is made in the contract.

Note- The responsibilities of the public organizations that provide cooperatives’ capital is borne by them proportion to the amounts of their capitals unless another term is arranged in the contract.

Article 24- The government is obliged to provide  necessary conditions and facilities for the quality and quantitative expansion of the cooperatives in the realization of the goals stipulated in principles 43 and 44 of the constitution and increasing the share of the cooperative sector in national economy by observing the necessities and in the template of the state economic and social development plans templates so this sector could play an effective role in the economic growth and development.

Note 1- For the above-mentioned purpose, the government is allowed to use the budget resources or banking resources with the governmental guaranty and provide the cooperative with interest free loan, sell movable and immovable properties, equipment and facilities in fair prices in cash or installment for the establishment and reinforcement of the cooperative or rent them accordingly or conclude hire-purchase contract, or transfer the stocks of companies, governmental institutes and state-owned institutes, banks, confiscated and nationalized enterprises to the cooperatives.

Note 2- Banks are obliged to award the cooperatives for investment and/or increase their capitals or reinforce their status loans and other facilities and can conclude contracts to put securities, mortgage or collateral for those loans, and/or if the cooperative is unable to pay back the loan, the bank will be allowed to clear the debts through selling the properties and in buying such properties, other cooperatives are in priority.

Chapter four- The profit and loss statement, divisions of profit and other financial regulations

Article 25- The net profit of the companies and cooperative unions is distributed as follows at the end of fiscal year:

1.     Of minimum five percent (5%), by the approval of ordinary general meeting, 10 percent will be transferred to the legal capital account.

Note 1- The legal reserve should continue until the total amount of reserve from the mentioned incomes reaches one fourth of average capital of the recent three years of the company.

Note 2- Cooperatives are allowed to use maximum one half of the legal reserve to increase their capital.

2.     Minimum five percent of the net profit will be reflected in the cautionary reserve account by the suggestion of board of directors and approval of the general meeting and the consumption method will be by the approval of ordinary general meeting.

3.     Four percent of net profit will be remitted to the Cooperative Fund as the cooperation fee and education.

4.     A percentage of the profit will be allocated for the rewards payable to members, employees, managers and inspectors at the suggestion of the board of directors and approval of ordinary general meeting of shareholders.

5.     After deducting the above-mentioned amounts, the remaining net profit will be distributed in the manner which is accepted in the article of association and the terms in the contract.

Chapter five- Production and distribution cooperatives

The production cooperatives include cooperatives that are engaged in agricultural, cattle breeding, cattle husbandry, fishery and fishery farms,  industries, mines, urban, rural and tribunal civil development and as such.

Note- The production cooperatives have priorities and supports related to the cooperatives.

Article 27- Distribution cooperatives are cooperatives that supply the demands of the productive occupations or members’ consumers in the framework of public interests and/or for the purpose of lowering the costs and prices.

Note- The distribution cooperatives that provide goods, housings and other demands of rural population, tribes, labors and civil employees will have priority over other cooperatives in terms of receiving quota of goods and governmental and banking supports and other protections related to the supply and distribution affairs.

Article 28- State-owned companies and governments and cooperatives are obliged to give priorities to the cooperatives in their transactions.

Note- The cooperatives subject of this law, by observing laws and regulations are allowed to engage in exports and imports activities in the scope of their business activities.

Chapter six- Foundations of cooperatives

Article 29- To run their affairs, the cooperative companies should have following foundations:

1.     General meeting

2.     Board of directors

3.     Inspector(s).

Part one- General meetings

The general meeting, based on this law, is the highest authority in adopting decisions and supervision in the cooperative companies affairs constitutes the members of the cooperative or their fully authorized representatives and is held on ordinary or extraordinary form and any member, regardless to the amount of shares, has only one vote.

Note 1-In the cooperative companies, any  governmental and state-owned entities, enterprises, banks, state Islamic councils and public organizations that have participated or invested in the cooperative can name a representative for the supervision and inspection in the cooperative and participation in the general meeting and board of directors to act as observer.

Note 2- Dissolution, mergence or changes in items of the cooperative statute that are against the terms and contracts signed by credit and financial contribution suppliers, different facilities providers, investment and participation require the agreement of the concerned – related- authorities.

Article 31- The board of founders constitutes of a number of individuals qualified to seek membership in the company that takes action for establishing the cooperative.

Article 32- The duties of the board of founders are:

1-    To draw up and propose the article of association according to the laws and regulations

2-    Invitation for the membership of qualified persons

3-    To hold the first ordinary general meeting for the approval and registry of the article of association or statute, determine the board of directors and other duties of ordinary general meeting

Note 1- After holding the first ordinary general meeting and appointing the board of directors, the duties of the board of founders’ end.

Note 2- Those members who did not agree with the resolution of first ordinary general meeting on the article of association can return their membership application in the same meeting.

Note 3- Approval of the article of association or statute of the cooperative is done by receiving the votes of minimum two third of members in the first ordinary general meeting

Article 33- The ordinary general meeting holds session at least once a year after the expiry of fiscal year for performing its legal duties.

In emergency cases, the ordinary general meeting can hold session any time during the year on extraordinary form.

Note 1- The ordinary general meeting will be officially convened by the attendance of maximum members in the first call and if this quorum is not reached in that call, the meeting of the second call will be official by the attendance of  any number of official members.

Note 2- The general meetings of trans-provincial cooperative companies or companies with more than five hundred members scattered in different provinces of the country could be held in two-stage format.

In first meeting, the representative(s) of the cooperative members are determined in different areas of the company’s activities and in the second stage, the general meeting will be held by the attendance of the selective representatives of the members.

The method of appointing representative(s) in the first stage, their scope of authorizations and exercising voting in the second stage of general meeting will be based on the instruction which is notified by the Cooperative Ministry.

Note 3- The holding of general meeting will be in accordance with the by-law which is draw up by the Ministry of Cooperative. If the board of directors does not hold the ordinary or extraordinary general meeting on the appointed date, the Ministry of Cooperation will hold general meeting directly.

Note 4- The meetings and ordinary general meeting decisions for cooperatives with more than one hundred members will be notified to the members through publishing notices in a widely circulated daily which has been named in the general meeting.

Article 34- The duties and authorizations of ordinary general meeting are as follows:

1.     To appoint the board of directors and inspector(s)

2.     To investigate and adopt decisions on the balance sheet, profit and loss statements and other financial reports of the board of directors after reading the inspector(s) report.

3.     To determine the policy and plans of the cooperative and to approve the current budget, investments, credits and loans requested and other financial operations at the proposal of the board of directors.

4.     To adopt decision on increasing or decreasing the capital within the templates of laws and regulations

5.     To decide on reserves and to pay the interests and additional income, and to distribute them in accordance with the article of association or statute.

6.     To approve the local regulations and instructions of the cooperative

7.     Other duties that are assigned to the general meeting according to the laws and regulations.

8.     To appoint a widely circulated daily for publishing the notices of company

9.     To adopt decisions on membership of the cooperative company in enterprises, companies, unions, cooperative chambers, their stocks and/or annual membership fee payable based on the regulations stipulated in this law.

Article 35- Extraordinary general meeting is held for making changes in the articles in the statute (within the scope of this law); decide on discharging or accepting the resignation of board of directors, dissolution or mergence of the cooperative.

Note 1- The extraordinary general meeting is held at the request in writing of minimum one third of the cooperative members and/or unanimous majority of board of directors and/or inspector(s) with the presence of minimum two third of total members of the meeting. If the meeting quorum is not achieved in the first term by two third of members, the second meeting will be officially convened by half plus one members and in the third term, it will be officially convened by any member of participants.

Note 2- If the board of directors does not take actions to hold extraordinary general meeting maximum within one month, the Cooperative Ministry will take actions to hold the general meeting.

Part two- Board of directors

Article 36- The Department of Cooperative Affairs, according to the article of association, is run by a board of directors consisting minimum three members and maximum seven principal members and up to one third of alternate members whom are elected from members for three yeas and with confidential vote. Taking vote for selecting principal members will be performed in one term. Those who receive maximum votes following the principal members will be recognized as alternate members. There is no restriction in re-electing any principal and alternate members of board of directors for maximum two subsequent terms.

Note 1- Individuals that succeed by receiving two third of total votes of cooperative company members will be exempted from the banning regulations of being elected  more than two terms as mentioned in this article.

Note 2- The election of principal and alternate members of board of directors will be performed by unanimous majority of general meeting.

Note 3- The board of directors in its first session elects a chairman of board of directors, one vice-chairman and one or two secretaries.

Note 4- In case of death, resignation, legal banning or frequent unexcused absence (as mentioned in the article of association), the members of board of directors invite one of the alternate members who had received highest vote to be the principal member for the remaining term of office to participate in the sessions of board of directors.

Note 5- The members of board of directors by the approval of general meeting can receive remuneration and benefits. If the member of board of directors receives salary from another place, he will only receive rewards in the concerned cooperative. The minimum and maximum remuneration and rewards of board of directors and the exceptional items are those listed in the by-law which is approved by the Ministry of Cooperative.

Article 37- The duties and authorizations of the board of directors are as follows:

1.     To call for the (ordinary and extraordinary) general meeting

2.     To implement the terms of the article of association, decisions of general meeting and other relevant regulations

3.     To hire, discharge and accept the resignation of managing director, to supervise his operations and to propose managing director’s remuneration to the general meeting

4.     Supervision on the current expenses of the cooperative, auditing the accounts and presenting them to inspector(s) and  on time submission of financial reports and cooperative balance sheets to the general meeting

5.     To draw up and develop plans, programs, budgets and other proposals and present them to the general meeting

6.     To draw and develop plans, budgets and other proposals and to present them to general meeting for adopting decisions

7.     To appoint representative from members of cooperative for appearing in the general meetings of companies and unions that the cooperative is a member of them.

8.     To prepare and develop internal instructions of the cooperative and presenting them to the general meeting for due approval

9.     To appoint representative or proxy in courts and legal officials and other organization with substitution right

10.                        To appoint and name legal signatories (one or two members of board of directors joined by the managing director) for the contracts and binding documents of the cooperative

Note- The board of directors performs its duties collectively and no member of the board of directors is allowed to use the authorizations of the board individually unless in special cases when he is acting as the proxy or written representation of the board of directors. The board of directors is allowed to assign a part of its powers to the managing director with three fourth of votes.

Article 38- The members of board of directors, managing director and inspectors should have following qualifications:

1.     Iranian nationality

2.     Practical commitment and faith to Islam (in the cooperatives consisted of minority religions whom are recognized by the constitution, practical commitment to their own religion)

3.     Having necessary information or experiences for fulfilling the duties proportion to that cooperative

4.     No legal prohibition or legal protection

5.     No membership records in anti-revolution groups and no records of crimes against the state and its security, no forgery records

6.     No penal records or sentences because of fraudulence, embezzlement, breach of trust, illegal possession of governmental properties and bankruptcy by its own fault.

Article 39- Immediately after the election, the board of directors should appoint a managing director from members of cooperative or outside the cooperative for two years to fun the cooperative operations and to implement the decisions of the general meeting. The managing director to perform his duties under supervision of the board of directors. The duties, authorizations, remuneration and benefits of the managing director will be in accordance with a by-law which is approved by the general meeting at the proposal of board of directors.

Part three- Inspection

Article 40- The general meeting will appoint an inspector (or inspectors) from natural persons or legal entities for one year. There is no restriction in their re-election.

Note 1- In the event of death or legal bans and resignation of principal inspector(s), the board of directors is obliged to invite the alternate inspector (s) to perform his (their) duties as per the number of higher votes for the remaining term of office.

Note 2- The remuneration of inspector(s) will be determined by the approval of general meeting.

Article 41- The duties of the cooperative inspector (s) are as follows:

1.     To render constant monitoring on the compatibility of running the cooperative affairs, the operations and transactions which are performed by the instructions of  the article of association, laws, regulations and relevant instructions

2.     To investigate the accounts, books, doucments, financial statements such as balance sheet, profit and loss statements, the proposed budget and reports of the board of directors to the general meeting

3.     To investigate the complaints of members and presenting report to the general meeting and concerned officials.

4.     Giving written notices on the violations of rules in running the cooperative affairs to the board of directors and managing director and requesting the removal of those shortcomings.

5.     To supervise on auditing and investigating the auditing reports, and the report on investigation to the general meeting of company and concerned authorities. [29]. Note- Inspector(s) are not allowed to be directly involved in the cooperative affairs management; however, they are allowed to participate in the board of directors meetings without having votes and express their opinions on the current issues of the cooperative.

Article 42-If any of the inspectors decides that the board of directors or the managing director has violated the rules in performing their duties and has  not considered the notices given by the inspectors, they will be obliged to demand the board of directors to hold a general meeting for the investigation of their report.

Note- If the board of directors does not hold the extraordinary general meeting within one month from receiving the inspector’s request, the inspector will be allowed to inform the Ministry of Cooperative for publishing a notice and holding extraordinary general meeting.

Chapter seven- Cooperative Union

Article 43- The cooperative unions with the membership of companies and cooperatives with the same activities subject will be held for meeting some or all purposes mentioned below:

1.     To provide educational, cultural and advertisement services related to the cooperatives to the member cooperatives and improving their scientific, technical, specialized and information level needed by the members and expansion of cooperative teachings

2.     To provide research and study services on the subjects needed by the member cooperatives and assisting in collecting the statistics, information and economic and social reports for them and the Ministry of Cooperation.

3.     To help in the organization and good management, coordination, protection and development of the cooperatives subject of their activities.

4.     To help in establishing communication and counter collaboration between the cooperatives, between the cooperatives and people, and government as well as other local and foreign relations and communications.

5.     To provide administrative, financial, accounting, auditing, inspection, trading, and credit services, establishment of interest free loans funds and rendering other economic activities needed by the member cooperatives.

6.     To provide joint needs, marketing, purchase, sell, export and import demands of the member cooperatives

7.     To provide technical, specialized, and legal services, to accept representing other members in all their necessary affairs consultative and guidance services and other facilities needed by the cooperatives

8.     Monitoring and supervision over the commitment of the cooperatives subject of their activities to follow the relevant laws and regulations and reporting the violations to the concerned legal officials.

9.     To settle disputes and provide arbitration in the scopes related to the cooperative in an amicable way and make peace among the cooperative members.

Note 1- Membership in the cooperative union is optional and cooperatives that are not a member of the union will not benefit from the unions legal rights.

Note 2- Only one union will be held in each city for the object of activities rendered by the cooperative.

Article 44- The capital of the cooperative unions is funded by the payments of shares by the member cooperatives (proportion to the number of the cooperative members and amount of their benefitting from union services). The increase in the union capital is made through increasing the shares, membership payments and other collections. Any decision on the capital or its decrease or increase will be performed by the approval of two third of the general meeting participants of the union.

Article 45- Any cooperative union has following foundations:

1.     General meeting

2.     Board of directors

3.     Inspection board

Article 46- The general meeting of the cooperative unions is held by the representatives of member cooperatives and each cooperative has only one vote. Other regulations related to the general meeting are the same as mentioned part one, chapter six.

Note- In the events when the number of cooperative members that are members of the union and the volume of their transactions with the union are not close, the number of cooperatives of each cooperative union will be proportion to the number of their members and with a combination of members and volumes of transactions they had with the union, in accordance with the instruction which is notified by the Ministry of the Cooperation.

Article 47- The members of the board of directors of the cooperative unions are elected at the proposals of the member cooperatives and the approval of the general meeting and in any cases, no more than one member from any cooperative could be a representative in the board of directors.

Article 48- The members of board of directors are appointed for three years term of office and can be re-elected in subsequent order only for one more term. Other duties and authorizations related to the mentioned board of directors in chapter six will govern the matter on the union board of directors as well.

Article 49- The managing director is elected for three years term of office by the approval of the majority of two third of members of the board of directors and can be re-elected for two subsequent terms of office. The managing director will have the entire executive authorizations of the union in accordance with the article of association in implementing the relevant laws and regulations, approvals of the general meeting, administration of the cooperative unions and other duties and authorizations which are not assigned to the cooperative union foundation.

Article 50- The inspection board is in-charge of performing the auditing and inspection of the cooperative union. The members of this council are appointed by the general meeting of the union. The reports of the inspection council should be approved by unanimous vote of the board members.

Chapter eight- Establishment and registration of cooperatives

Article 51- Cooperative companies and unions should present following documents for the establishment and registration after preparing the plan and its approval in a quality which will be specified in the executive by-law:

1.     The minutes of the founders meeting establishment, the first general meeting, the list of members, the elected board of directors and inspectors

2.     Article of association approved by the general meeting

3.     Written application for due registration

4.     Proposal plan and permit of the Ministry of Cooperative

5.     The receipt of paying the capital

6.     Documents of invitations subject of clause 2, article 32.

Note- The first board of directors upon accepting its position, should meet the formalities and register the cooperative.

Article 52- The corporations registration company should register the cooperatives after receiving the necessary doucments and papers.

Chapter nine-Mergence, dissolution and liquidation

Part one- Mergence

Article 53- Cooperative companies might merge by the approval of the extraordinary general meeting and according to the executive by-laws terms of this law.

Note- The minutes of extraordinary general meeting of merged cooperatives should be submitted to the department for corporations registry, along with the relevant documents, maximum within two weeks and a summary of decisions should be notified to all members and creditors.

Part two- Dissolution and liquidation

Article 54- The cooperative companies and unions are dissolved in following instances:

1-    Decision of extraordinary general meeting

2-    Reduction in number of members from the limit if maximum within three months the number of members does not reach the quorum.

3-    Expiry of the deadline in article of association, if as such had been determined, and if the general meeting had not extended the period.

4-    No activities for more than one year without justified excuse.

5-    Disregarding the relevant laws and regulations after three written notices in a year by the Ministry of Cooperative according to the relevant by-law

6-    Bankruptcy according to the relevant regulations

Note 1- After informing the dissolution and registry, the liquidation will be carried out according to the Trade law immediately, at the registration office of the district.

Note 2- In clauses two, four and five, the Ministry of Cooperation will immediately inform the cooperative dissolution to the registration office of the district in accordance with the by-laws related to the cooperative dissolution.

Note 3- The views of the Ministry of Cooperative in clauses 4 and 5 could be opposed and investigated in the registration office of the place.

Note 4- The entire properties that are put in access of cooperatives by governmental public sources should be returned upon its dissolution.

Article 55- If the extraordinary general meeting or the Ministry of Cooperative  votes to dissolution of cooperative, it should appoint three persons for liquidation of cooperative affairs and introduce them to the registration place  and take actions in liquidation of cooperative affairs.

Article 56- If a cooperative is dissolved, before dissolution, it should fulfill the obligations which it has undertaken before banks, municipalities and public organizations for receiving the capital, properties and privileges.

Chapter ten- Cooperative chamber

Article 57- Cooperative companies and unions in case of necessity and by supervision of the Ministry of Cooperative will establish central chamber of commerce in Tehran and its branches in provinces and cities for the purpose of followings:

1.     To perform duties and authorizations of chamber of commerce, industries and mines in connection with the cooperative sector

2.     To perform the affairs assigned to them by the Ministry of Cooperation in accordance with the by-law

3.     To settle disputes and perform arbitration in the scope of the affairs related to the cooperatives amicably and compromise among members, unions, and the  cooperatives and unions

Note- Any cooperative chamber has a legal and independent entity and is not depended to the government in financial and administrative of expenses.

Article 58- Foundations of each cooperative chamber are:

1.     Representatives assembly

2.     Board of directors

3.     Council of inspection

Article 59- The representatives assembly of cooperative chamber of the town consists of representatives of unions and representatives of cooperatives with similar activities that lack of a union, in the territory of that town or city, and the representatives assembly of chamber of province cooperatives consisting of the heads of board of directors of the cooperative chambers of tons of the city without a union, and the delegates of unions with the same territory as the province; and, the representatives assembly of chamber of central cooperatives consists of heads of provinces chambers of cooperatives and the delegates of provincial unions without cooperative chamber and the delegates of national unions who are elected for three years.

Note 1- The duties of representatives assembly include:

A-  To study proposals related to the article of association, the by-laws of he chamber, their confirmation for final approval of the Minister of Cooperative

B-   Appointing the board of directors of the cooperative chamber

C-   Appointing two inspectors for membership at the council of inspection

D-  Approval of annual plan and budget at the proposal of board of directors

E-   Investigation and making decisions on balance sheet and other reports of the board of directors after receiving the opinion of council of inspection

F-    Investigating the reports of council of inspection

Note 2- The number of votes of the member representatives in the assembly of city cooperative chamber, province cooperative chamber and central cooperative chamber is determined by the Ministry of Cooperative proportion to the number of cooperative members and unions member of the union and cooperative chambers.

Article 60- The board of directors of chamber of cooperative consists of three to seven principal members and two alternate members, elected from members of cooperatives that will be as much as possible  from agriculture, rural, tribal, industrial, mines, urban and rural development and distribution cooperatives whom are elected by the  representatives assembly.

Article 61- The duties of board of directors are:

1.     To render necessary activities for providing the purposes of the chamber of cooperation as per the article of association and relevant by-laws

2.     To  administer the affairs related to the chamber of commerce and to perform all communications, correspondences and financial operations needed by the chamber in accordance with the internal by-laws

3.     Implementation of decisions of representatives assembly

4.     Presenting reports and proposals to the representatives assembly

5.     Election of chairman of board of directors from its members

6.     Election of secretariat in the province and city chambers and director general in the central chamber for performing executive affairs

Note- The board of directors is entitled to assign some of its authorizations to the director general or secretariat.

Article 62- The board of directors of chamber of cooperative in any province has the duty of establishing cooperation and coordination among the chambers of its cities and they in turn, are obliged to cooperate. In addition, the board of directors of the central cooperative chamber of the Islamic Republic of Iran is obliged to establish cooperation, coordination and collaboration among provinces chambers and they are bound to cooperate.

Article 63- The council of inspection consists of three members, two of them are elected by the council of representatives and one by the Ministry  of Cooperatives and their duties are:

A-  Supervision and constant inspection in terms of observing the articles of association and the by-laws of the chamber of cooperatives and their regulations and laws.

B-   To investigate the accounts, books, documents and financial statements such as balance sheet, financial performance and reports to be presented to the representatives and the Ministry of Cooperation

C-   Study complaints and offences related to the chamber of cooperatives and reporting to concerned officials

D-  To present annual and periodic reports to the council of representatives and the Ministry of Cooperation in terms of the status of activities of chamber of cooperative and following the regulations and laws and expressing views on the board of directors’ reports

Note- The board of directors is obliged to hand over to the council of inspectors the documents and papers requested by the council.

Article 64- The financial sources of the cooperative chambers are:

1.     To receive membership fee from members in the cooperative chamber

2.     Receipt of governmental, popular, councils and boards contributions and gifts

3.     Receipt of consultation fees, expertise and arbitration payments in the scope of affairs related to the cooperatives in an amicable way and other services that it provides to the cooperatives and unions.


Chapter eleven- Ministry of cooperative

Article 65- To implement the government’s supervision in the execution of laws and regulations related to the cooperative sector and support to this sector, the Ministry of Cooperative has been established.

Note 1- The rural cooperative organization, central cooperation of the state, mining cooperative central office, centers for the expansion of production and civil development services and other offices, organizations and entities that work in connection with the cooperative section of the ministries and different organizations will be  dissolved and their entire duties, authorizations, properties, assets, budgets, credits, personnel and other facilities will be transferred to the Ministry of Cooperation and this ministry will be  established by using the budget and facilities of the mentioned centers.

The organizational structures and positions of the Ministry of Cooperative which will not exceed the number of positions in the dissolved entities will be determined by the proposal of the Minister of Cooperative and approval of the state administrative and employment organization within six months (during which time, the dissolved organizations will perform their duties).

Note 2- The cooperative fund will be separated from the Ministry of Labor and Social affairs and is merged in the Ministry of Cooperative; and the duties and authorizations of its general meeting will be assigned to the Minister of Cooperative, accordingly for performing the credit activities. Any changes in the articles of association of the Fund will be at the proposal of the Minister of Cooperative and approval of the council of ministers.

Article 66- The duties and authorizations of the Ministry of Cooperative are as follows:

1-    To implement the part of laws and regulations in connection with the cooperative that is related to the government and to supervise on the good implementation of laws and regulations of the cooperative sector.

2-    To draw up legal bills and by-laws of this law, the articles of associations and the cooperatives by-laws in accordance with this law.

3-    To attract and coordinate the supports, contributions, facilities and governmental and public facilities for cooperative sector with the cooperation of concerned executive entities

4-    To encourage, help and cooperate in the establishment and expansion of cooperatives by attracting the cooperation and participation  of public and state Islamic councils

5-    To prepare grounds for the cooperation, coordination and collaboration among the cooperatives and cooperative unions and/or between the cooperative sector and other economic sectors

6-    To contribute in advertisement, educational, cultural, technical, scientific, research and indusial activities required for the cooperative sector with the collaboration of cooperation unions

7-    To assist cooperative companies and unions in providing legal, financial, accounting, auditing and other services

8-    To participate in the international cooperatives meetings and associations as the representative of the Islamic Republic of Iran

9-    To implement the plans for the propagation and teaching cooperation for understanding and popularizing the methods, different plans of cooperatives and publishing books and journals needed by the cooperatives

10-                       To guide responsible of cooperatives in legal, financial and administrative affairs and to direct them towards using better methods and systems

11-                       To guide the cooperatives officials in legal, financial and administrative affairs and to direct them towards using better methods and systems

12-                       To perform statistics and information researches and study on the activities of cooperatives in recognizing inefficiencies and their needs, and their capabilities and facilities to be used in the relevant planning

13-                       To establish coordination in exercising technical, administrative, financial and other assistances by concerned entities if necessary for the proper administration of the cooperatives

14-                       To establish necessary facilities for the development of cooperatives activities in production affairs

15-                       To provide means for exportation of cooperatives products

16-                       To draw up and propose basic plans to provide grounds for the realization of he goals stipulated in principals 43 and 44 of the constitution of the Islamic Republic of Iran

17-                       If it is proved that there has been violation of rules in administrating corporation’s affairs or cooperative unions, the Ministry of Cooperative will be entitled to report the matter to a competent court and the court should investigate the matter in emergency hearings and if the violation is proved, the court will suspend managers of companies and cooperative unions. In such case, the Ministry of Cooperative should appoint individuals to hold general meeting and elect new members of board of directors temporarily.

18-                       To prevent the activities of natural persons or legal entities that misuses the name of the cooperative.

19-                       To provide necessary facilities for cooperatives’ achievement to raw materials and needed equipment and commodities

20-                       Setting policies, determining lines of activities and planning in the scope of regulations and authorities for the development and growth of the cooperative sector

21-                       To provide necessary facilities to prepare plans, establish, develop, reconstruct and renovate cooperative units and supervise on their affairs

22-                       To provide conditions and means for investment in cooperative sector  to establish cooperatives with the priority of production cooperatives

23-                       To draw up plans and determine the method of providing credit contributions within the regulations and authorizations through banks and credit institutes and governmental contributions to the cooperatives

Note-The Council of Money and Credit is obliged to grant loans and necessary assistances to the cooperatives every year based on the request of the Ministry of Cooperative and by observing the financial and monetary policies.

24-                       To participate, establish, develop, utilize and invest in cooperatives and, to transfer or sale of the government’s stocks in the production and distribution units to the cooperative sector while observing the contents of note to article 17 of this law.

25-                       Membership at the Council of Economy, high council of industries, council of money and credits, general meeting of banks, high council of mines and commissions of exports and imports as well as other association by the opinion of the council of ministers

26-                       To participate in developing exports and imports regulations of the country.

27-                       Cooperation with the international scientific, technical  and economic institutes, accepting the membership and participating in organizations, councils and international societies related to the cooperative affairs

28-                       Issuance of permit subject of clause 4, article 51

29-                       To take away the benefits of cooperatives that has acted against the law and regulations of the cooperative sector or has taken actions against the approved article of association.

30- Establishment of cooperative in the agricultural sector

Article 67- The executive by-law of this law will be drawn up by the Ministry of Cooperative within six months and will be duly approved by the council of ministers.

Article 68- To supervise the election of corporations and cooperative unions, and the chamber of cooperation, an association consisting the delegates of the Ministry of Cooperation, Ministry of the Interior and the Judiciary, and two persons from the Chamber of cooperation (if any), chaired by the representative of the Ministry of Cooperation.

Note- The executive by-law of this article will be proposed by the Ministry of Cooperation and approval of the council of ministers.

 Note- The executive by-law of this article will be proposed by the Ministry of Cooperation and approved by the council of ministers.


Chapter twelve- Other regulations

Article 69- Any companies and cooperative unions are obliged to match their articles of association with this law and have the changes in their article of association registered as a cooperative after the confirmation of the Ministry of Cooperation; otherwise, they will not benefit from the cooperation sector and this law.

Article 70- The Rials and foreign currency credits and lines related to the dissolved entities in note 1 of article 65 are omitted from the existing laws and regulations and are transferred to the Cooperation Ministry as independent lines. The budget and planning organization and the foreign currency allocation committee are obliged to separate that part of credits of other executive sysems that are in connection with the cooperative activities and transfer them to the Ministry of Cooperation.

 

Article 71- Other laws and regulations contradicting this law are abolished.

Date of passing the law: September 4, 1991

Authority of passing the law: Islamic Consultative Assembly

Further amendments: October 4, 1998

----------------------------------

[1] The phrase “Non-governmental law” by virtue of clause one of article one of the Act pertaining to Modification of Parts of Cooperative Economy  Sector Law of the Islamic Republic of Iran has been added to article 8 of the law.

[2] Amendment  of the Islamic Consultative Assembly on September 28, 1998

[3] Amendment  of the Islamic Consultative Assembly on September 28, 1998

[4] Amendment  of the Islamic Consultative Assembly on September 28, 1998

[5] Amendment  of the Islamic Consultative Assembly on September 28, 1998

[6] By virtue of clause one of article 3 of the Act pertaining to Amendments in Cooperative Sector Law, the phrase “Extraordinary general meeting” was changed to “ordinary general meeting”.

[7] The phrase “Board of directors or inspectors”  replaced the word “managers” in implementing clause two of article 3 of the Act pertaining to Amendments in Cooperative Sector Law

[8] Amendment by the Islamic Consultative Assembly on September 29, 1998

[9] By virtue of article 10 of the Act pertaining to Amendments on Parts of the Fourth Economic, Social and cultural development Law of the Islamic Republic of Iran and implementation of general policies in principal 44 of the constitution, all cooperative companies and unions of the Islamic Republic of Iran  are allowed to transfer up to forty nine (49) percent of their stocks by exercising voting procedures on the establishment date or increase in their capital, and up to thirty five (35) percent of their total votes and seats of the board of directors with the same proportion to natural persons and legal entities that are not cooperative members by conditioning that no negotiations will be made in the sovereignty of members and by observing a definite ceiling per share and vote of each non-member shareholder. Sale to non-Iranian persons should be through observing the regulations that govern foreign investment.

[10] Amendment through law of Islamic Consultative Assembly on September 27, 1999

[11] By virtue of article 6 of the Act, pertaining to the Amendment of Cooperative Sector, the word “ordinary” has been added to the “General meeting” phrase.

[12] By virtue of article 6 of the Act, pertaining to the Amendment of Cooperative Sector, the word “ordinary” has been added to the “General meeting” phrase.

[13] By virtue of article 6 of the Act, pertaining to the Amendment of Cooperative Sector, the word “ordinary” has been added to the “General meeting” phrase.

[14] Amendment through law of Islamic Consultative Assembly on September 27, 1999

[15] Amendment of Islamic Consultative Assembly on September 29, 1998

[16] By virtue of articles 8 and 9 of the Act pertaining to Amendments on Cooperative Sector Law, the phrase “Founders association” in articles 31 and 32 of the Law was changed into “Board of Founders”.

[17] By virtue of article 9 of the Act pertaining to Amendments on Cooperative Sector Law, the word “ordinary” has been added to the phrase “general meeting”.

[18] By virtue of article 9 of the Act pertaining to Amendments on Cooperative Sector Law, the word “ordinary” has been added to the phrase “general meeting”.

[19] By virtue of article 9 of the Act pertaining to Amendments on Cooperative Sector Law, the word “ordinary” has been added to the phrase “general meeting”.

[20] Amendment of Islamic Consultative Assembly on September 29, 1998

[21] Amendment of Islamic Consultative Assembly on September 29, 1998

[22] Amendment of Islamic Consultative Assembly on September 29, 1998

[23] Amendment by virtue of article 11 of the Act pertaining to the modification of cooperative sector law

[24] Amendment by virtue of article 11 of the Act pertaining to the modification of cooperative sector law

[25] Amendment of Islamic Consultative Assembly on September 29, 1998

[26] Amendment of Islamic Consultative Assembly on September 29, 1998

[27] By virtue of articles 14 and 15 of the Act pertaining to Amendments on Cooperative Sector Act, article 38 of the law was amended as above and the note below it was deleted.

[28] Amendment of Islamic Consultative Assembly on September 29, 1998

[29] Addendum subject of article 17 of the Act pertaining to the modification of cooperative sector law, passed on September 29, 1998

[30] Amendment of Islamic Consultative Assembly on September 29, 1998

[31] Addendum, subject of article 18 of the Act pertaining to modification of cooperative sector law, passed by the Islamic Consultative Council on September 29, 1998

[32] By virtue of second clause of article 10 of the Act pertaining to Amendments on Parts of the laws on Fourth Economic, Social and Cultural Development Plan of the Islamic Republic of Iran  and implementing general policies in principal 44 of the constitution, passed in 2008, the cooperative companies are authorized to establish specialized cooperative unions in the frameworks of articles 61 and 62 of the Cooperative Companies Establishment Law of 1971 without following note 2 to article 43 of  the Economic  Cooperative Sector of Islamic Republic of Iran, passed in 1991

[33] Amendment of Islamic Consultative Assembly on September 29, 1998

[34] By virtue of second clause of article 10 of the Act pertaining to Amendments on Parts of the laws on Fourth Economic, Social and Cultural Development Plan of the Islamic Republic of Iran  and implementing general policies in principal 44 of the constitution, passed in 2008,  in the general meetings of various cooperative unions, the number of members’ votes will be proportion to the member’s amount of shares and/or the volume of their transactions with the union or a combination of both, according to the terms of the article of association.

[35] Amendment of Islamic Consultative Assembly on September 29, 1998

[36] Amendment of Islamic Consultative Assembly on September 29, 1998

[37] Amendment of Islamic Consultative Assembly on September 29, 1998

[38] Amendment of Islamic Consultative Assembly on September 29, 1998

[39] According to clause 7 (seven) of part C of article nine of the Act pertaining to Amendments of Parts of the Law on Fourth Economic, Social and Cultural Development plan of the Islamic Republic of Iran and implementation of the general policies in article 44 of the Constitution, passed in 2008, the public joint stock cooperatives are allowed to seek membership at the cooperative chambers.

[40] Amendment of Islamic Consultative Assembly on September 29, 1998

[41] Amendment of Islamic Consultative Assembly on September 29, 1998

[42] Clauses 5 and 6, article 61 of the note in it have been added to the cooperative sector by virtue of article 26 of the Act pertaining to the Cooperative sector.

[43] By virtue of note 1 of the Act pertaining to modification of parts of the Law on Fourth Economic, Social and Cultural Development plan of the Islamic Republic of Iran and implementation of the general policies in article 44 of the Constitution, passed in 2008, the Cooperative Fund has been changed into Cooperative Investment Guarantee Fund after the establishment of Cooperative Development Bank through amendments of the article of association.

[44] By virtue of article 27 of the Act pertaining to Amendments on Parts of the Cooperative Sector Law, clause 17 of article 66 has been amended as described above.

[45] Amendment of Islamic Consultative Assembly on September 29, 1998

[46] Amendment of Islamic Consultative Assembly on September 29, 1998

 

Rapport the banks and institutions
Central Building Address: Tehran / Karimkhan street / avenue Mirza Shirazi / martyr Fereydoun Ave Nzhadky / 13
Director Office: 3-88845242
Tel: 11-88842609 Fax: 88845241
All rights reserved The Internet portal Guarantee Fund's investment cooperation.