Cooperative

Cooperative service.

A cooperative is an autonomous association of people united voluntarily to form a democratic organization whose administration and management must be carried out in the manner agreed upon by the members, generally in the context of the market economy or the mixed economy, although cooperatives have also occurred as a complementary part of the planned economy. Its intention is to address the economic, social and cultural needs and aspirations common to all partners through a company. The diversity of needs and aspirations (work, consumption, joint marketing, education, credit, etc.) of the partners, which make up the corporate purpose or corporatized activity of these companies, defines a highly varied typology of cooperatives.

The International Cooperative Alliance (ICA) in 1995 adopted a Declaration of Cooperative Identity during its II General Assembly held in the city of Manchester, where the definition of a cooperative is included which says that "A cooperative is an association autonomous community of people who have voluntarily joined together to address their common economic, social and cultural needs and aspirations through a jointly owned and democratically controlled enterprise."

The cooperative principles constitute the basic rules of operation of these organizations. The Andalusian Cooperative Law of 2011 adds two new cooperative principles. The International Cooperative Alliance (ICA) is the international organization that since 1895 brings together and promotes the cooperative movement in the world. The cooperative is the most widespread form of social economy entity.

The main identifier for cooperatives and cooperativism on the Internet is the ".coop" domain.

In 2016, Unesco declared cooperatives and the cooperative movement as Intangible Heritage of Humanity.

Types of cooperatives

Agricultural Cooperative of Alginet, 1963

Although various classifications of cooperatives are made, it is usual to focus mainly on the activity or purpose they carry out.

There are different types of cooperatives:

• Cooperative of associated work or production cooperative.
• Social cooperatives also considered as a form of cooperatives.
• Savings and Credit Cooperative
• Consumer and User Cooperative
• Agricultural cooperative
• Cooperative of services: they aim to perform all kinds of benefits, services or economic functions, not attributed to other companies regulated by this Law, in order to facilitate, promote, guarantee, extend or complete the activity or results of the independent exploitations of the partners, or those constituted by professionals and artists who carry out their activities independently and aim to carry out services and occupations that facilitate the professional activity of their partners.
• Cooperative housing: formed for the attainment of homes.
• Transport cooperative: it is a group of drivers or drivers, drivers who decide to work directly in an organized and joint way to provide efficient service to the community, through the transport of people or loads.
• Tourism cooperative: the aim of which is to make tourism, or promote it in a given area.
• Cooperative of artists: organizations of musicians, poets, writers, actors, etc.
• Craftsmen Cooperative: they cooperate for the distribution and sale of their works.
• Educational cooperative: aimed at providing educational services to partners, their children and/or the community.
• School cooperatives: School cooperatives are societies of students administered by themselves with the competition of teachers for common activities. Inspired by an ideal of human progress based on the moral education of the small cooperative society through society and the work of its members.
• Trade cooperative
• Supply cooperative
• Pharmaceutical Cooperative
• Media cooperative
• public service cooperative: they provide some useful and necessary service for the community, such as water and sanitation, taxi, telephone, garbage collection, etc.
• Mixed cooperative: they are those that combine different types of cooperatives.

There are also some more specific types, such as cooperatives for community land exploitation, renewable energy energy cooperatives, rural electrification cooperatives or sea cooperatives.

Cooperative Values

• Mutual help: it is joint action for solving common problems or cooperation.
• Responsibility: it is the ability to respond to acts, the level of performance in the implementation of activities for achieving goals, feeling a moral commitment to partners.
• Social responsibility: commitment to the community, concern for others.
• Democracy: collective decision-making by partners (through participation and ownership) regarding the management and control of the cooperative.
• Equality: All partners have equal duties and rights.
• Equity: fair distribution of surpluses among cooperative members.
• Solidarity: support, cooperate in solving problems of partners, family and community. Community of interests and purposes.
• Honesty and transparency: honesty, dignity and decency in the conduct of partners. They oppose the cover-up, the falseing of information and deception.
• Self-effort: motivation, strength of will of members in order to achieve planned goals by giving the best of each.

Principles

Current principles

The current principles were approved at the International Cooperative Alliance Assembly in Manchester on 23 September 1999.

1. Open and voluntary accession. Cooperatives are voluntary organizations, open to all those willing to use their services and willing to accept the responsibilities of partners, without discrimination of gender, race, social class, sexual orientation, political or religious position.
2. Democratic control of partners or members. Active participation, with responsibility to the general assembly and partners by the elected authorities. Each partner always has the right to a single vote, regardless of their contribution.
3. Economic participation of partners or members. Equity. Limited compensation. The surpluses of each period first contemplate reservations, education and solidarity.
4. Autonomy and independence. Partner without becoming dependent, and without responding to external interests.
5. Education, training and information. To partners, leaders, managers and employees. But also, inform the community about cooperativeness. This principle is joined to the 7th.
6. Cooperative cooperation. Through local, regional and national structures, in order to better serve and support new entities.
7. Commitment to the community. Sustainable development, solidarity, acceptance of partners, social responsibility.

Classical principles

The following principles were systematized in 1937 by the International Cooperative Alliance:

• Free accession or open doors.
• Democratic control.
• Return of surpluses to each member, in proportion to their contribution to them.
• Limited interest in capital (great difference with societies).
• Neutrality: mainly political and religious. Modernly neutrality has also spread to the racial, ethnic, by nationality, sectarian, ideological, trade union, etc.
• Sale of cash (principle that has been yielding) and at market prices.
• Cooperative promotion and education: spreading cooperative values between members and society at large.

Other principles

Some authors^[who?] acknowledge other principles:

• Mutuality: only members can make use of the services of the cooperative, as long as it is not a commercial company and therefore has no desire for profit, nor to become a clientele.
• Inavailability of reservations: in case the cooperative is liquidated, those will not pass to their members. Successive capitalization of surpluses (which form reservations) is intended for the cooperative, and not for its members.
• Cooperative integration (or cooperative federalism): since it acquires its strength in the number of its members.

Cooperative structure

The cooperative is normally based on the production model of private companies, taking it as the nucleus of economic activity, although as a model of mercantile companies it also presents some peculiarities in its structure.

The following is a table that tries to explain the differences between a cooperative company and a classic mercantile company.

Although there are substantial differences between the organization and the distribution of benefits, in both cases the common interest is to generate profits in order to satisfy their own needs, regardless of the motivation of each person

History

The cooperative movement was born within the framework of the Industrial Revolution, during the XX century so that its partners in the company Obviously they could or would have access to the best possible price and quality conditions (consumer cooperatives), avoiding intermediaries, to maximize the income of the cooperative members.

One of the first cooperative experiences dates back to 1844, when the Rochdale Equitable Pioneers Society consumer cooperative was created in Rochdale, England (in 1769, the Society of Spinners Consumer Cooperative had been founded of Fenwick or 'Fenwick Weavers' Society', in East Ayrshire, Scotland). Simultaneously other experiences arise in France, Spain and other European countries. Among the first great thinkers of cooperativism are Robert Owen, Charles Fourier and Friedrich Wilhelm Raiffeisen, respectively Welsh, French and German, who made a critique in which they proposed that the solution of social problems can be achieved through cooperation between individuals.

The old flag of the cooperative movement was represented by the 7 colors of the rainbow, which symbolized diversity and hope at the same time. The color red represented fire and the love that unites people; the orange was reminiscent of a glorious sunrise; yellow for the color of the sun that gives light, heat and life; green represented hope; the celestial blue figured as a reflection of the illusion; navy blue or indigo embodied the value that drives us to seek new routes; and finally violet meant humility and virtue.

Subsequently, at the 1995 ICA Congress, it was decided to change the classic cooperativism flag for a flag with a white background with a rainbow that breaks to become doves in full flight.

During 2012 the International Year of Cooperatives was celebrated, as proclaimed by the General Assembly of the United Nations.

Cooperatives around the world

America

Argentina

In Argentina, cooperatives are governed by National Law 20,337. The state control body is currently the National Institute of Associations and Social Economy (INAES).

Regarding the constitution of cooperatives, the founding associates must attend an information and training course on cooperatives.

There are provinces in Argentina where we can observe a greater organization of the cooperative sector, but we cannot^[who?] say that there are places where a group of associates does not are organized under this system.^{[citation required]} The Constitution of the Province of Misiones is related to cooperativism: by promoting it in education, granting it privileges for the delivery lots, exploitation of resources and services at the same level as public bodies, etc.

In 2016, Argentina had an approximate number of 30,000 active cooperatives of different types: agricultural, housing, consumer, credit, provision, public services, work. According to the latest Census of Cooperatives and Mutualism carried out by INAES in 2008, there were 12,760 cooperatives in the country and 4,166 mutuals. As a whole they generated 265,054 direct jobs. Among the first, 59.7% corresponded to work cooperatives. Since the 2000s, numerous companies began to take shape, recovered by their workers, who occupied them and put them to work after their abandonment by their shareholders. These companies (mainly factories) have mostly preferred to become self-managed cooperatives.

Chili

In Chile, according to figures from the Ministry of Economy, Development and Tourism, there are around 1,200 active cooperative companies, in various fields, such as services, agriculture, peasant, fishing, work and savings and credit, grouping more than one one million three hundred thousand people.^{[citation required]}

There are a large number of small and medium-sized cooperative companies in the agricultural and livestock world. They usually receive state support through the National Institute for Agricultural Development, an institution created for the development of agriculture during the agrarian reform of the 1960s; however, the most successful agricultural cooperatives in the country are Capel and Colún, and they predate that process.

Another nationally recognized cooperative is Coopeuch, a savings and credit cooperative originally created in 1967 by officials from the University of Chile and which today is present throughout the country; and also Coopercarab (Cooperativa de Carabineros), a series of multi-stores present in various cities.

Chilean housing cooperatives also carry out an important activity in the field of housing acquired with a housing subsidy provided by the Chilean State. One of the most important is Conavicoop, which since 1975 has built more than 40,000 homes in the regions of Valparaíso and Araucanía, including the Metropolitan Region.

The body in charge of supervising cooperatives and promoting the growth of the cooperative sector in Chile is the Department of Cooperatives, of the Ministry of Economy, Development and Tourism. Under this same name, in 1935 one of the leading radio stations in that country was born, first calling itself Cooperativa Vitalicia, today simply Cooperative.

Columbia

Even though in Colombia cooperativism, as a way for communities to manage their interests, goes beyond national regulations, the different states have recognized and regulated them in their internal legal systems, Colombia having done so since the government of Enrique Olaya Herrera (1930-1934). Recently, Law 79 of 1988 and Law 454 of 1998, are the legal norms that regulate these private law associations in Colombia, where transporter cooperatives, associated work cooperatives and cooperative public administrations have had special development.. The Superintendence of Solidarity Economy supervises the preservation of the values, principles, characteristics, activities, results and benefits of the members of Colombian cooperatives.

Cooperative Public Administrations.

Characterized the cooperative movement by the self-management of its participants in the associative entity created to solve their common problems, the reality of the difficulties —essentially economic—- faced by some poor municipalities in Colombia, determined that they were created in the middle of the XX century there, associations of municipalities that governed under cooperative principles, came to generate what today are called Cooperative Public Administrations, aimed at providing solutions to common needs of the territories.

The initial idea of contributions from associates seeking to carry out tasks of common service and under the collegiate direction of the members, certainly allowed the development of these entities, which are expressly recognized in Colombia by Decree Law 1482 of 1989, with Over time, however, they have raised an important crossroads to the legality of the Public Administration: Can a cooperative of public entities, governed by the principle that they can only do what the law authorizes them (C.N. Art. 6), meet the principle of "self-management" cooperative, without violating cooperative law and its own nature? Today there is still no authorized solution on the point, and the operational difficulties that this cooperative typology has determined are resolved with sometimes inconceivable lurches, derived from the State control bodies that fight for debatable powers before these social entities.

Costa Rica

In Costa Rica there are a large number of cooperatives, among them the most recognized are: Cooperativa de Productores de Leche (which is identified as Dos Pinos, which is actually a symbol of cooperatives), the Rural Electrification Cooperatives, the Agricultural cooperatives for the export of products and the Credit and Savings Cooperatives Credecoop R.L. The latter move significant amounts of savings and credit, in many cases with a greater volume of assets than private banks.

The Rural Electrification Cooperatives are dedicated to the distribution and generation of electricity for their members. In Costa Rica there are four cooperatives of this type: Coopelesca, Coopeguanacaste, Coopesantos and Coopealfaroruiz.

Mexico

In Mexico, Cooperatives began in 1902, promoted by the Catholic Church and under the German system, but with the religious persecution of 1926 the Cooperatives movement perished. It was not until the end of 1951, through efforts of the Mexican Social Secretariat directed by Father Pedro Velásquez, after publishing pamphlets on the popular savings banks, that the first three cooperatives were established in Mexico City.

The Cruz Azul cooperative is a clear example of success. It was founded in 1881 as a purely commercial and foreign company benefited by the Englishman Henry Gibbon, located in a part of the old Hacienda de Jasso, in 1932 it was expropriated by the Governor of the State of Hidalgo, Bartolomé Vargas Lugo. It was Don Guillermo Álvarez Macías with whom modern cooperativism began and survives as a company in a globalized world.

In 1964, "Caja Morelia Valladolid" In order to contribute to the social and economic development of its associates and form a savings bank, it was founded in the city of Morelia, thanks to the interest of Father José Ibarrola, hence the name of &# 34;Caja José Ibarrola", which to date is governed under the principles of Universal Cooperatives. It is currently authorized by the National Banking and Securities Commission CNBV to be a regulated savings and credit entity, which promotes and facilitates the collection of resources and later the distribution of credits for the members of a cooperative with the security that their resources They are protected.

In 1991, the federal executive published the General Law of Auxiliary Credit Organizations and Activities, in which the legal figure of Savings and Loan Society was integrated; This legal instrument recognized the popular savings banks for the first time. However, only about twenty popular savings banks adhered to this law.

In 1994, the cashier movement consulted the partners to define the position in the treatment of this new law. 62 popular savings banks decided to form a single national institution, which is why in 1995 Caja Popular Mexicana, Savings and Loan Society was established.

There are also service production cooperatives that have focused on the development of the cooperative sector, such is the case of the "Cedicoop" Integral Development Center, created in 2014, where training, consultancies, advisory services and the creation and incubation of companies under the cooperative model.

At the local level, on January 20, 2006, the III Legislature of the Legislative Assembly of the Federal District, issued the decree by which the Law of Cooperative Development for the Federal District is created.: its purpose, the definition of Cooperative Society and Cooperative Development, the constitution of an Advisory Council of the Federal District and 16 Delegation Councils, the Regulation of the Law, the powers and powers of the Head of Government, Secretariats and the 16 Delegation Heads.

• Article 1.- [...] aims to establish, regulate and coordinate policies, programs and cooperative promotion actions for the economic development of the Federal District, [...]
• Article 2.- Definition of the cooperative promotion. [...] is understood as cooperative promotion the set of legal norms and actions of the Government of the Federal District, for the organization, expansion and development of the sector and cooperative movement [... ]
• Article 3.- Definitions. For the purposes of this Law, it will be understood by: I. Cooperative Society: the form of social organization composed of individuals based on common interests and on the principles of solidarity, self-effort and mutual assistance, with the purpose of meeting individual and collective needs, through the realization of economic activities of production, distribution and consumption of goods and services.
• Article 21.- An Advisory Council on Cooperative Development of the Federal District will be constituted as a consultative body on the subject, which will be chaired by the Head of Government of the Federal District [...] The Regulations of this Law shall regulate the procedure of choice, as well as the organization and functioning of this Council.

Paraguayan

The customs, organization and way of life of the Guarani constitute the immediate antecedent of cooperative doctrine and practice in the country; All this would later be used through the Jesuit reductions. The indigenous people used to hold amadayé or tribal assembly, and practice both oñondivepá or solidarity work and yopói or mutual aid.

In the 1940s, the first cooperatives formally arose, which were for production and were governed -in the absence of special legislation- by the Commercial Code; The oldest registered precedent being that of an agro-industrial cooperative of winegrowers and winemakers from Guaire, created in 1941. That same year, Decree-Law No. 13,635 was sanctioned, which would later become law. The number of cooperatives grew gradually over the next fifty years. In 1972, the new Law No. 349 on Cooperatives was approved, which among other provisions created the General Directorate of Cooperatives, a government entity. By 1983 there were 162 cooperatives with more than 50,000 members. In recent times, due to the great growth of the movement, experienced especially since the 1990s, the current law, No. 438/94 on Cooperatives, was approved. For the year 2011, official data indicates the existence of a total of 937 cooperatives, with 1,220,150 associates, mainly savings and credit, and production.

For some years Paraguay has been one of the countries with the highest percentage of cooperative members -over the total population-, in the world (nearly twenty percent of the residents in the territory).^{[quote required]}

It is a very strong movement giving high competition to finance companies and banks due to their low rates and their strong social performance. In addition, there are Mutual Funds for Private Retirement, although their results are still doubtful.

The main organization is the Paraguayan Confederation of Cooperatives (CONPACOOP), which brings together the country's cooperatives and federations.

There is also a National Institute of Cooperatives (INCOOP), a government entity created from Law 2157/03: "That regulates the operation of INCOOP and establishes its Organic Charter", which says in its Art. 1° That: "It is a legal person under public law, autonomous and self-sufficient, of indefinite duration, it will be the Enforcement Authority of Cooperative Legislation and Control Authority of Cooperative Entities, and will be governed by the provisions of this Law, the regulations and other norms related to Cooperatives". Its president is appointed by the president of the republic from a shortlist elected by the National Assembly of Cooperatives.

Peru

In the Congress of the Republic, a Special Commission has been created in charge of Evaluating Compliance with ILO Recommendation 193 and formulating a New Legal Framework for Cooperatives, which is chaired by Congressman, Mg. Jose A. Urquizo Maggia.

On June 16, 2010, the Commission for the Economy, Banking, Finance and Financial Intelligence, chaired by Congressman Luis Galarreta Velarde, submitted for debate Bill No. 3747, which specifies the scope of Articles 3 and 66º of the General Law of Cooperatives, the same one that was supported by the president of the National Coffee Board, César Rivas, and the adviser, César Quispe Luján, who pointed out that the legislative proposal states that SUNAT recognizes that between the partner and his cooperative, and vice versa, are cooperative acts, which do not generate tax obligations, thus avoiding double taxation, the same that has always been recognized in Peruvian cooperative legislation.

This initiative was supported by the congressmen (GPF), who requested that this project be placed on the agenda and submitted to a vote, which was unanimously accepted. Congressmen Raúl Castro (UN) and Rolando Reátegui (GPF) supported their interventions, as well as Congressman Yamashiro Oré (UN), who stated that "coffee cooperatives make a great contribution to the country, SUNAT knows how much is exported and who export coffee It is unjustifiable that farmers and producers are subjected to double taxation," said the legislator. Once the interventions were completed, Galarreta Velarde submitted the project to a vote without any modification, and it was approved by majority.

The congressmen voted in favor of the law: Rafael Yamashiro (UN), Rolando Reategui (GPF), Carlos Canepa (UPP), Daniel Abugattás (PNP) and César Zumaeta (PAP).

Venezuelan

Cooperative organizations in Venezuela date back to 1890 when the first one was founded in the Andean town of Chiguará in the State of Mérida, as a savings and credit entity. Around 1900, in the eastern part of the country, on the Isla de Margarita, specifically in the city of Porlamar, a cooperative of artisans was founded.

In 1910 the Cooperatives Law was promulgated, with great similarities to the French one. In 1919, cooperatives were incorporated into the Commercial Code as commercial companies, in section X On Cooperative Societies with a single article that refers to the corresponding Law.

Article 353.- All matters relating to cooperative societies shall be governed by special laws and regulations.

In 1937, the then President Eleazar López Contreras promoted cooperativism with ordinances to the other Presidents of States (now Governors) to encourage the constitution of this type of society in the regions. In 1944, the State is obliged to promote and protect cooperatives through a new Law on Cooperatives enacted during the tenure of President Isaías Medina Angarita.

In 1960, the first Cooperative was founded in the state of Falcón, which is an expression of a new conception of Venezuelan Cooperatives. It is the Tacuato cooperative in Punto Fijo.

Subsequently, in 1966 the General Law of Cooperative Associations was promulgated, which in addition to deepening the obligation of the State in the promotion and development of cooperatives, created the National Superintendency of Cooperatives (SUNACOOP)

In 1967, the first cooperative central called Central Cooperativa de Servicios Sociales Lara (CECOSESOLA) was founded. Cecosesola is constituted as a cooperative integration organism that integrates a network of some 50 popular organizations belonging to the States of Lara, Trujillo, Yaracuy, Portuguesa and Barinas. The organizations that make up the network have 20,000 associated people, of whom 1,000 are associated workers. The services, which are provided at prices well below those stipulated by the market, benefit 70,000 families, in most cases coming from the popular sectors.

• Article 70: They are means of participation and prominence of the people in exercise of their sovereignty, [...] in the social and economic: [...] cooperatives in all their forms, including those of a financial character [...]
• Article 118: The right of workers as well as the community to develop social and participatory associations, such as cooperatives, is recognized. These associations may develop any economic activity in accordance with the law. The law shall recognize the specifications of these organizations, in particular those relating to the cooperative act.... The State will promote and protect these associations [...]
• Article 308: The State shall protect and promote [...] cooperatives, [...] in order to strengthen the economic development of the country.

In 2001, a new Special Law on Cooperative Associations was enacted. By 2008, SUNACOOP registered more than 260,000 cooperatives throughout Venezuela, of which 61,856. This figure would place Venezuela as the country with the largest number of active cooperatives in Latin America.

Europe

Cooperatives are structured at the European Union level in a confederation called Cooperatives Europe. There are different public instances of the European Union active in the field of cooperatives and social economy, such as the Social Economy Intergroup of the European Parliament and the European Economic and Social Committee.

Spain

In Spain, cooperatives are currently regulated by various regional laws on cooperatives. State Law 27/1999 of July 16, on Cooperatives applies to cooperative societies that carry out their cooperative activity either in the territory of several autonomous communities, or that carry out their cooperative activity mainly in the cities of Ceuta and Melilla.

Law 20/1990, of December 19, on the Tax Regime of Cooperatives divides cooperatives into non-protected, protected and specially protected.

According to Law 27/1999, on Cooperatives, a cooperative can belong to one of the following classes:

• Associate Work Cooperative.
• Consumer and User Cooperative.
• Cooperative housing.
• Agricultural cooperative.
• Cooperative of community land exploitation.
• Service cooperative.
• Cooperative of the sea.
• Transport cooperative.
• Insurance cooperative.
• Health cooperative.
• Educational cooperative.
• Credit cooperative.

As a historical reference, the communities that emerged during the Spanish Revolution of 1936 were a significant experience of a cooperative and self-managed society.

Today, the largest cooperative group in the world is located in Spain, the Mondragón Corporation, founded by the Basque priest Fr. José María Arizmendiarrieta, known as the "apostle of cooperation" and that the cause of his canonization has been introduced.

Mondragon is a Basque cooperative business organization made up of autonomous and independent cooperatives that compete in international markets, that uses democratic methods in its corporate organization, and that aspires to job creation, the human and professional promotion of its workers and the development of their social environment.

United Kingdom

In the UK, the Co-op Group, formerly the Cooperative Wholesale Society (or "CWS"), owns many supermarkets across the country and at the same time supplies wholesale goods to most British retail co-operatives, providing common branding and logo. In some regions there are independent societies; for example, in the South West of England, in Plymouth and in the South the Western Cooperative owns a majority of Cooperative branded supermarkets. There is also a cooperative bank and insurance company. There are several cooperative companies that provide other services, for example, travel, funeral homes, hotels, etc. Finally, and although they are not cooperatives, there are numerous and successful "Housing Associations" (Housing Associations), non-profit organizations that build and rent houses to their members in exchange for a reasonable and stable income.