Law of the People's Republic of China on Specialized Farmers Cooperatives (Revised in 2017)
Presidential Decree No. 83
The Law of the People's Republic of China on Specialized Farmers Cooperatives, revised and adopted at the 31st Session of the Standing Committee of the 12th National People's Congress of the People's Republic of China on December 27, 2017, is hereby promulgated, effective July 1, 2018.
President Xi Jinping
December 27, 2017
(Adopted at the 24th Session of the Standing Committee of the 10th National People's Congress on 31 October 2006 and revised at the 31st Session of the Standing Committee of the 12th National People's Congress on 27 December 2017)
第一章 总 则
Chapter 1 General Provisions
Article 1 This Law is enacted for the purpose of standardizing the organization and activities of specialized farmers cooperatives, encouraging, supporting and guiding their development, protecting their lawful rights and interests and those of their members, and pushing forward the modernization of agriculture and rural areas.
Article 2 Specialized farmers cooperatives as mentioned herein refer to the mutual-help economic organizations joined voluntarily and managed in a democratic manner by the producers and operators of agricultural products or by the providers or users of services for agricultural production and operation.
Article 3 Specialized farmers cooperatives mainly serve their members, conducting one or more of the following business:
1. purchasing or using the means of agricultural production;
2. Production, marketing, processing, transportation and storage of agricultural products and other related services;
(III) development and operation of rural folk crafts and products, leisure agriculture and rural tourism resources;
(IV) Technology, information, facility construction and operation and other services related to agricultural production and operation.
Article 4 Specialized farmers cooperatives shall observe the following principles:
1. Their members are mainly farmers;
2. They aim to serve their members, working for the common interests of all the members;
(III) The members join the cooperatives voluntarily and are free to withdraw from them;
(IV) The members are equal in status and democratic management is practiced; and
(V) Profits are to be distributed mainly in proportion on the volume (amount) of the transactions effected between the cooperatives and their members.
Article 5 Specialized farmers cooperatives shall be registered according to this Law to obtain the status of a legal person.
Specialized farmers cooperatives shall enjoy the rights to possess, use and dispose of their property which includes capital contributions by their members, common reserve funds, subsidies received directly from the government, donations and other legitimately acquired assets, and shall be liable for their debts with the aforementioned property.
Article 6 Members of specialized farmers cooperatives shall be accountable to their cooperatives within the limits of the capital contributions recorded in their accounts and of their shares of the common reserve funds.
Article 7 The State ensures that farmers' cooperatives enjoy the equal legal status with other market entities.
The State protects the lawful rights and interests of the specialized farmers cooperatives and their members, and no units or individuals may infringe upon such rights and interests.
Article 8 In production and operation, specialized farmers cooperatives shall obey the relevant laws, observe social and business ethics and act in good faith, and shall not engage in any activities that are not related to their charter.
Article 9 To enlarge the scale of production, operation or service, develop the industrialized operation and enhance the market competitiveness, a specialized farmers cooperative may voluntarily establish or join a specialized farmers cooperative union according to law.
Article 10 The State promotes the development of specialized farmers cooperatives through such measures as government financing, preferential taxation, support in fund raising, science and technology as well as human resources, and guidance through industrial policies.
The State encourages and supports citizens, legal persons and other organizations to provide assistance and services to specialized farmers cooperatives.
Units and individuals that have made outstanding contributions to the development of specialized farmers cooperatives shall be commended and rewarded according to the relevant provisions of the State.
Article 11 People's governments at or above the county level shall establish a mechanism for comprehensive coordination of the work relating to specialized farmers cooperatives, and guide, coordinate and push forward the formation and development of specialized farmers cooperatives in an overall manner.
The administrative departments of agriculture and the relevant departments and organizations under the people's governments at or above the county level shall provide guidance, support and services to the formation and development of specialized farmers cooperatives within their respective functions and duties.
Chapter 2 Establishment and Registration
Article 12 For establishment of a specialized farmers cooperative, the following conditions shall be met:
1. having five or more members who meet the requirements as are prescribed in Articles 19 and 20 of this Law;
2. it shall have articles of association as provided for in this Law;
3. having an organizational structure that meets the requirements as are prescribed by this Law;
(IV) having a name which is in conformity with the provisions of relevant laws and administrative regulations and a domicile as specified in the charter; and
(V) having capital contributions made by members who meet the requirements as are specified in the charter.
Article 13 A member of a specialized farmers cooperative may make capital contribution in cash, in kind, with intellectual property rights, land-use right, forest right or other non-monetary property that may be assessed on the basis of currency and may be transferred according to law, or in other ways as prescribed in the charter, excluding the property that shall not be used as capital contributions according to the relevant laws or administrative regulations.
No member of a specialized farmers cooperative may use its claims against the cooperative or other members to offset its capital contribution, or use its capital contribution to offset its debt owed to the cooperative or other members.
Article 14 For establishment of a specialized farmers cooperative, an assembly shall be convened with the participation of all of the founders. Persons who voluntarily become members of the cooperative at the time of its establishment are founders.
The founders' assembly shall exercise the following functions and powers:
1. to adopt the charter of the cooperative, which is required to be adopted unanimously by all of the founders;
2. to elect the director-general, directors, the executive supervisor or members of the board of supervisors; and
(III) deliberating other major issues.
Article 15 In the charter of a specialized farmers cooperative shall clearly be specified the following matters:
1. its name and domicile;
2. Business scope;
(III) membership qualifications, joining and withdrawing from union and expelling a member;
(IV) rights and obligations of members;
(V) the organizational agencies of the mutual insurance organization, and their respective method of formation, authority, term of office and rules of procedure;
(VI) forms and amounts of capital contributions to be made by members, and assignment, succession and guaranty of member capital contributions;
(VII) financial management, distribution of profits and disposition of losses;
(VIII) Procedures for modifying the articles of association; and
(IX) causes for dissolution and measures for liquidation;
(X) the items for announcement and the manners of announcement; and
(XI) Establishment, exercise method and scope of additional voting rights;
(XII) other matters that need to be specified.
Article 16 For establishment of a specialized farmers cooperative, the following documents shall be submitted to the administrative department for industry and commerce to apply for registration:
1. an application for registration;
2. minutes of the establishment assembly signed and sealed by all of the founders;
(III) articles of association signed and sealed by all of the founders;
(IV) the appointment documents and identity certificates of the legal representative and the directors;
(V) list of capital contributions signed and sealed by the members who make such contributions;
(VI) the certificate of the use of domicile;
(VII) Other documents prescribed in any law or administrative regulation.
The registration authority shall complete the registration procedure within 20 days from the date it accepts the application for registration, issue a business license to the applicant that meets the conditions for registration, and register the qualified applicant as a specialized farmers cooperative.
Where a specialized farmers cooperative intends to alter the statutory items for registration, it shall submit an application for the purpose.
The registration authority shall report the information about registered specialized farmers cooperatives to the agriculture department and other relevant departments at the same level.
The measures for registration of farmers' cooperatives shall be formulated by the State Council. No fees may be charged for registration.
Article 17 A specialized farmers cooperative shall, according to the relevant provisions of the State, submit its annual report to the registration authority and disclose the same to the public.
Article 18 Specialized farmers cooperatives may invest in companies and other enterprises according to law, and are liable to the invested enterprises to the extent of their capital contributions.
第三章 成 员
Chapter 3 Members
Article 19 Citizens who have the capacity for civil conduct and enterprises, public institutions and social organizations that are engaged in production and operation which are directly related to the business of a specialized farmers cooperative may become members of the cooperative, provided that they can make use of the services offered by the cooperative, recognizes and abides by the charter of the cooperative and complete the formalities for joining the cooperative as prescribed in the charter. However, a unit that exercises the function of administering public affairs shall not join such cooperative.
A specialized farmers cooperative shall have a membership roll and file it with the registration authority.
Article 20 Farmers shall account for at least 80 percent of the membership of a specialized farmers cooperative.
If the total number of members of a cooperative is 20 or less, there may be one enterprise, public institution or social organization as its member; if the number exceeds 20, the number of enterprises, public institutions or social organizations shall not exceed five percent of the total number.
Article 21 A member of a specialized farmers cooperative shall enjoy the following rights:
1. to attend the membership assembly, have the rights to vote, to elect and to stand for election, and exercise democratic management of the cooperative according to the stipulations in the charter;
2. to make use of the services and production and operation facilities provided by the cooperative;
(III) to share profits according to the stipulations in the charter or the resolution of the membership assembly;
(IV) to consult the charter, membership roll, minutes of the membership assembly or of the conference of members' representatives, resolutions of the board of directors and of the board of supervisors, and financial statements, account books and financial audit reports;
(V) other rights as stipulated in the charter.
Article 22 The system of "one person, one vote" shall be adopted for election and voting at the membership assembly of a specialized farmers cooperative, and each member shall have the right to one basic vote.
Members who make considerably large capital contributions or who effect considerably large amounts (volumes) of transactions with the cooperative may, according to the stipulations of the charter, enjoy the right to extra votes. The total number of extra votes of the cooperative shall not exceed 20 percent of the total number of the members' basic votes. Each time a membership assembly is convened, all members present at the assembly shall be informed of those members who enjoy the right to extra votes and the number of extra votes they each enjoy.
Article 23 A member of a specialized farmers cooperative shall be charged with the following duties:
1. executing resolutions of the membership assembly, the conference of members' representatives and the board of directors;
2. to make capital contributions to the cooperative as stipulated in the charter;
(III) to effect transactions with the cooperative as stipulated in the charter;
(IV) bearing losses according to the articles of association;
(V) Other obligations stipulated in the charter.
Article 24 Where a citizen, enterprise, public institution or social organization meeting the requirements as prescribed in Articles 19 and 20 of this Law requests for joining an established specialized farmers cooperative, he/it shall file a written application with the director-general or the board of directors of the cooperative, and shall become a member of the cooperative after its/his membership is approved by voting at the membership assembly or the conference of members' representatives.
Article 25 If a member of a specialized farmers cooperative intends to withdraw from the cooperative, he shall submit a written application to the director-general or the board of directors three months prior to the end of the fiscal year; and if an enterprise, public institution or social organization intend to withdraw from the cooperative as a member, it shall do so six months prior to the end of the fiscal year; if the charter stipulates otherwise, the stipulations there shall prevail. The membership qualifications of a withdrawing member shall be terminated at the end of its fiscal year.
Article 26 A member of a specialized farmers cooperative who fails to abide by the charter of the cooperative or to observe a resolution made by the membership assembly or the conference of members' representatives, or who severely harms the interests of other members or the cooperative may be expelled.
The removal of a member's name from the membership roll shall be approved by voting at the membership assembly or the conference of the members' representatives.
When the provisions in the preceding paragraph are implemented, an opportunity shall be provided for the member to express its opinion.
The membership of the member removed shall be terminated at the end of the fiscal year.
Article 27 A member shall continue performing the contract concluded with the specialized farmers cooperative before the termination of his membership, unless otherwise stipulated in the charter or otherwise agreed upon by him and the cooperative.
Article 28 At the termination of the membership, the cooperative shall, in the manners and within the time limit as are stipulated in the charter, return to the member the amount of the capital contributions recorded in his account and his shares of the common reserve funds; and it shall, according to the provisions in Article 44 of this Law, return to him the distributable profits earned by the cooperative prior to the termination of his membership qualifications.
The member whose qualification is terminated shall share the losses and debts incurred by the cooperative before the termination of his qualification according to the articles of association.
Chapter 4 Organizational Structure
Article 29 The membership assembly of a specialized farmers cooperative shall be composed of all of the members. It is the organ of power of the cooperative and shall exercise the following functions and powers:
1. Modification of the articles of association;
(II) to elect and remove the director-general, directors, the executive supervisor or members of the board of supervisors;
3. to decide on the disposal of major property, external investment, providing guarantee to entities and individuals outside the cooperative, and other major issues in respect of production and operation;
(IV) to approve the annual business report, plans for profit distribution and for disposition of losses;
(V) to make resolutions on the merger, split, dissolution, liquidation, and the establishment of or joining in a cooperative union;
(VI) to decide on the number of managers for business operation and technicians to be employed and their qualifications and terms of office;
(VII) to hear reports on the change of membership delivered by the director-general or the board of directors, and to pass resolutions on the joining and expulsion of members;
(VIII) Withdrawal and use of common reserve funds;
(IX) other functions and powers provided for in the charter.
Article 30 When a specialized farmers cooperative holds its membership assembly, the number of persons present shall be two-thirds or more of its membership.
The outcome of an election held or the resolution made at a membership assembly shall be deemed to be effective if it is adopted by more than half of the total votes of the members of the cooperative; for a resolution on modifying the charter, on merger, division or dissolution of the cooperative, or on establishment of or joining in a cooperative union to be adopted, two-thirds or more of the total votes of the members of the cooperative is required. If the charter requires a greater number of votes on such matters, the stipulations there shall prevail.
Article 31 Membership assembly of a specialized farmers cooperative shall be held at least once every year, and convening of the assembly shall be stipulated in the charter. A special membership assembly shall be held within 20 days under one of the following circumstances:
1. It is proposed by 30 percent or more of the members;
2. it is proposed by the executive supervisor or the board of supervisors; or
(III) Other circumstances as stipulated in the charter.
Article 32 Where the number of members of a specialized farmers cooperative exceeds 150, a conference of members' representatives may be organized according to the stipulations of the charter. The conference of members' representatives may exercise part or all of the functions and powers of the conference of members' representatives according to the stipulations of the charter.
If a conference of members' representatives is set up according to the law, the number of members' representatives shall generally account for 10 percent of the total number of members of the cooperative, and shall be not less than 51.
Article 33 In a specialized farmers cooperative there shall be a director-general, and a board of directors may be set up. The director-general shall be the legal representative of the cooperative.
A specialized farmers cooperative may have an executive supervisor or a board of supervisors. The director-general, director, manager, the book-keeper or accountant shall not concurrently serve as a supervisor.
The director-general, director, the executive supervisor or members of the board of supervisors shall be elected at the membership assembly from among the members of the cooperative, and they shall exercise their functions and powers according to the provisions prescribed in this Law and the charter and shall be responsible to the membership assembly.
The system of "one person, one vote" shall be applied to voting at the meetings of the board of directors and the board of supervisors.
Article 34 Decisions made on the matters discussed at the meetings of the membership assembly, the conference of members' representatives, the board of directors and the board of supervisors of a specialized farmers cooperative shall be recorded in the minutes, which shall be signed by the members of the assembly, members' representatives, directors and supervisors present at the meetings.
Article 35 The director-general or the board of directors of a specialized farmers cooperative may employ managers, book-keepers and accountants according to the decision made at the membership assembly, and the director-general or director may concurrently hold the office of a manager. A manager may, according to the stipulations of the charter or the decision of the board of directors, employ other staff members.
A manager shall be responsible for the specific production and operation as stipulated in the charter or as authorized by the director-general or the board of directors.
Article 36 The director-general, director or manager of a specialized farmers cooperative shall not do any of the following:
1. illegally taking into his own possession, misappropriating or illegally sharing the assets of the cooperative;
2. in violation of the stipulations of the charter or without permission of the membership assembly, loaning to another person the funds of the cooperative or providing guarantee to another person with the assets of the cooperative;
3. taking into his own possession the commissions charged for transactions effected between another person and the cooperative; or
(IV) engaging in other activities jeopardizing the economic benefits of the cooperative.
Any incomes derived by the director-general, director or manager in violation of the provisions in the preceding paragraph shall belong to the cooperative; if any losses are caused to the cooperative, he shall be liable for compensation.
Article 37 The director-general, director or manager of a specialized farmers cooperative shall not concurrently hold the office of the director-general, director, supervisor or manager in another specialized farmers cooperative that is engaged in the same nature of business as is the said cooperative.
Article 38 A person who handles official business concerning specialized farmers cooperatives shall not concurrently hold the office of the director-general, director, supervisor, manager, book-keeper or accountant in such a cooperative.
Chapter 5 Financial Management
Article 39 The specialized farmers cooperatives shall carry out their financial management and accounting according to the financial and accounting system formulated by the department of finance under the State Council.
Article 40 The director-general or the board of directors of a specialized farmers cooperative shall, according to the stipulations in the charter, organize efforts to prepare the annual business report, plans for profit distribution and for disposition of losses, and financial statements, and shall, 15 days prior to the convening of the membership assembly, make them available in the office for the members to consult.
Article 41 Accounting for the transactions effected between a specialized farmers cooperative and its members shall be separated from the ones effected between the cooperative and the non-members that make use of the services provided by the cooperative.
Article 42 A specialized farmers cooperative may draw common reserve funds from the profits of the year in accordance with the stipulations in the charter or the decision made by the membership assembly. The common reserve funds shall be used to make up losses, expand production and operation or be converted into members' capital contributions.
Reserves set aside each year shall be quantified as shares for each member in accordance with the Articles of Association.
Article 43 A specialized farmers cooperative shall start an account for each member, in which shall mainly be recorded the following:
1. the amount of capital contributions of the member;
2. the quantified common reserve funds as shares of the member; and
3. the volume (amount) of transactions effected between the member and the cooperative.
Article 44 The profits of the year left after the losses are made up for and the common reserve funds are drawn shall be the distributable profits of a specialized farmers cooperative. The distributable profits shall be distributed mainly in proportion to the volume (amount) of the transactions effected between the members and the cooperative.
The total amount of distributable profits returned in proportion to the volume (amount) of the transactions effected between the members and the cooperative shall not be less than 60 percent of the distributable profits; the rest of the profits left after the return shall be distributed pro rata to the members of the cooperative, on the basis of the capital contributions and shares of common reserve funds recorded in the members' accounts and the members' average quantified shares of the assets accumulated from subsidies directly given by the government and donations made by other persons to the cooperative.
Upon approval by voting at the membership assembly or the conference of members' representatives, all or part of the distributable profits may be converted into the capital contributions to the specialized farmers cooperative, which shall be recorded in the members' accounts.
The specific measures for distribution shall be decided according to the stipulations in the charter or the resolution of the membership assembly.
Article 45 Where there is an executive supervisor or a board of supervisors in a specialized farmers cooperative, the executive supervisor or the board of supervisors shall be responsible for the internal financial auditing of the cooperative and shall report the auditing results to the membership assembly.
The membership assembly may also entrust an intermediary with the financial auditing of the cooperative.
Chapter 6 Merger, Division, Dissolution and Liquidation
Article 46 Where a specialized farmers cooperative intends to merge with another cooperative, it shall inform its creditors of the matter within 10 days from the date the resolution is made to such an effect. The surviving or newly established organization after the merger shall succeed to the claims and debts of the parties to the merger.
Article 47 Where a specialized farmers cooperative intends to be divided, it shall have its assets divided accordingly, and shall inform its creditors of the matter within 10 days from the date the resolution on division is made. The debts before the division shall be jointly and severally liable by the organizations after the division. However, if before the division the parties have reached a written agreement with the creditors on the repayment of debts, then the former provision does not apply.
Article 48 A specialized farmers cooperative shall be dissolved for one of the following reasons:
1. Any of the causes as prescribed in the articles of association for dissolution occurs;
2. A resolution on dissolution is made by the membership assembly;
(III) dissolution is required due to a merger or division;
(IV) Its business license is revoked or its registration is cancelled according to law.
Where a cooperative is dissolved due to the reasons as specified in subparagraph (1), (2) or (4) of the preceding paragraph, a liquidation team composed of the members of the cooperative who are elected by the membership assembly shall be formed within 15 days from the date a cause for dissolution arises, in order to initiate liquidation for dissolution. If a liquidation team cannot be formed at the expiration of the time limit, members and creditors of the cooperative may apply to a people's court for designating members to form a liquidation team, and the people's court shall accept such an application and in a timely manner, designate members to form a liquidation team.
Article 49 A liquidation team shall, from the date it is formed, take over the specialized farmers cooperative, and it shall be responsible for disposing of the outstanding businesses which are related to the liquidation, straightening out the assets, credits and debts, distributing the assets left after the debts are repaid, participating in litigation, arbitration or other legal proceedings on behalf of the cooperative and, at the end of the liquidation, handle the formalities for canceling registration.
Article 50 A liquidation team shall, within 10 days from the date it is formed, notify the members and creditors of the specialized farmers cooperative of its formation and announce the matter in newspapers within 60 days. Creditors shall, within 30 days of receiving notification, or within 45 days of the public announcement for those who have not received notification, report their claims to the liquidation team. The liquidation team shall be absolved from the obligation to make an announcement if all the members and creditors receive the notification within the prescribed time limit.
When declaring their claims, the creditors shall explain the matters concerned and provide the certifying documents. The liquidation group shall examine and record such claims.
During the period for declaration of creditor's rights, the liquidation team shall not make repayment to creditors.
Article 51 When a specialized farmers cooperative is dissolved due to the causes specified in the first paragraph in Article 48 of this Law, or when its application for bankruptcy is being processed by a people's court, it shall not handle any formalities for any member to withdraw from the cooperative.
Article 52 The liquidation team shall be responsible for drawing up liquidation plans for paying off the salaries and social insurance premiums of the employees of the cooperative, the taxes in arrears and other debts and for distributing the remaining assets, and shall execute the plans after they are adopted by the membership assembly, or confirmed by the people's court upon the team's application.
If the liquidation team discovers that the assets of the specialized farmers cooperative is insufficient to pay off the debts, it shall apply for bankruptcy to a people's court according to law.
Article 53 When a specialized farmers cooperative is being liquidated for dissolution or bankruptcy, the subsidiaries it directly received from the government which form part of its property shall not be distributed to the members of the cooperative as distributable surplus property, and such assets shall be disposed of according to the relevant provisions of the department of finance under the State Council.
Article 54 Members of a liquidation team shall be devoted to their duty and perform their duty of liquidation according to law, and they shall be liable for compensation if they intentionally cause losses to the members or creditors of a specialized farmers cooperative or do so through gross negligence.
Article 55 The relevant provisions of the Enterprise Bankruptcy Law shall be applicable to the specialized farmers cooperatives that go bankrupt. However, after the bankruptcy assets are used for paying off the expenses for bankruptcy proceedings and the debts incurred for the common good of creditors, priority shall be given to settling the outstanding accounts resulted from transactions with the farmer members of the cooperatives effected prior to bankruptcy.
Chapter 7 Specialized Farmers Cooperative Unions
Article 56 Three or more specialized farmers cooperatives may, on a voluntary basis, set up a specialized farmers cooperative union.
A specialized farmers cooperative union shall have its own name, organizational structure and domicile, a charter drawn up and recognized by all its members, and capital contributions made by members who meet the requirements as specified in the charter.
Article 57 A specialized farmers cooperative union shall be registered according to this Law, obtain the status of a legal person and obtain its business license. The type of registration shall be specialized farmers cooperative union.
Article 58 A specialized farmers cooperative union shall assume liability for its debts with all of its property; members of the specialized farmers cooperative union shall assume liability for the said union to the extent of their respective capital contributions.
Article 59 A specialized farmers cooperative union shall set up a membership assembly attended by all of its members, and the functions and powers of the membership assembly include modifying the charter of the specialized farmers cooperative union, electing and removing the director-general, directors and supervisors, deciding on business operation plans and distribution of profits, and deciding on external investment and guarantee programs.
A specialized farmers cooperative union shall not set up a conference of members' representatives, but may set up a board of directors, a board of supervisors or the executive supervisor. The post of director-general or director shall be held by a person selected by the member cooperatives.
Article 60 The system of "one cooperative, one vote" shall be adopted for election and voting at the membership assembly of a specialized farmers cooperative union.
Article 61 The measures for distribution of the distributable profits of a specialized farmers cooperative union shall be decided according to the principles as prescribed in this Law and the stipulations in the charter.
Article 62 Where a member of a specialized farmers cooperative union intends to withdraw from the union, it shall file a written application with the board of directors six months prior to the end of the fiscal year. The membership qualifications of a withdrawing member shall be terminated at the end of its fiscal year.
Article 63 Where there are no relevant provisions on specialized farmers cooperatives in this Chapter, the provisions on specialized farmers cooperatives in this Law shall apply.
Chapter 8 Supporting Measures
Article 64 The State supports the construction projects for developing agriculture and the rural economy, and the relevant competent farmers' cooperatives may be entrusted with or assigned such tasks.
Article 65 The Central and local governments shall respectively allot funds to support the specialized farmers cooperatives in providing services in respect of information, training, standards for farm products and their authentication, construction of infrastructure for agricultural production, marketing, technology dissemination, etc. The State shall give priority to the specialized farmers cooperatives in old revolutionary areas, ethnic areas, border areas and poverty-stricken areas.
Relevant departments of the people's governments at or above the county level shall strengthen the supervision over the use of fiscal subsidy funds.
Article 66 The policy-oriented financial institutions of the State shall adopt diversified means to provide funds through various channels in support of the farmers' cooperatives. The specific supporting policies shall be formulated by the State Council.
The State encourages the commercial financial institutions to provide financial services to the specialized farmers cooperatives and their members by diversified means.
The State encourages insurance institutions to provide various forms of agricultural insurance services to the specialized farmers cooperatives. The specialized farmers cooperatives are encouraged to carry out the mutual insurance business according to law.
Article 67 The specialized farmers cooperatives shall enjoy preferential treatment in taxation prescribed by the State in respect of agricultural production, processing, circulation and services and other economic activities involving agriculture.
Article 68 The price of electricity used for primary processing of agricultural products by specialized farmers cooperatives shall be determined according to the price of electricity used for agricultural production, and the land used for productive auxiliary facilities by specialized farmers cooperatives shall be managed as farmland. Specific measures shall be formulated by the relevant departments under the State Council.
Chapter 9 Legal Liabilities
Article 69 A person who illegally takes into his own possession, misappropriates, withholds, illegally shares or by other means infringes on the lawful property of a specialized farmers cooperative or its members, illegally intervenes with the production and operation of such cooperative or its members, apportions expenses or tasks to the cooperative or its members, or compels the cooperative or its members to accept paid services, thus causing financial losses to the cooperative, shall be investigated for legal responsibility according to law.
Article 70 Where a specialized farmers cooperative provides false materials for registration to the relevant registration authority or gets registered by other deceptive means, it shall be ordered by the registration authority to rectify and may be fined not more than 5,000 yuan; and if the circumstances are serious, its registration shall be canceled and its business license shall be revoked.
Article 71 Where a specialized farmers cooperative has not engaged in any business activities for two consecutive years, its business license shall be revoked.
Article 72 Where a specialized farmers cooperative makes false entries or conceals important facts in such materials as financial statements submitted in accordance with law to the relevant department in charge, it shall be investigated for legal responsibility according to law.
第十章 附 则
Chapter 10 Supplementary Provisions
Article 73 This Law shall apply to the specialized farmers cooperatives run by the employees who carry out business operations through contracting or leasing, or engage in agricultural production, operation or services in state-owned farms, forest farms, pastures or fishing grounds.
Article 74 This Law shall come into force as of July 1, 2018.
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