The Ministry of Agriculture and Agrarian Reform issued the procedural rules for productive farmers’ cooperatives via Decree No. 20 of May 16, 2023. These rules centre around the collective cooperation of members to improve agricultural production but also impact members’ rights to use and possess their lands. The new procedures are an extension of Agricultural Regulation Law No. 21 of 1947 and its amendments, which regulate all aspects of agricultural union activity and production.
A cooperative association must contain at least 30 members who implement collective work towards agricultural investment and increased production. The group structure must include a general assembly that is the highest authority, composed of all its associates and founding members. This body’s duties are to discuss and approve plans, accounts and projects. Next comes the association council, which serves as an executive authority and which consists of five to nine members. The general assembly selects it. Each association must also have a director appointed by that governorate’s Farmers’ Union who coordinates with the association council in carrying out the group’s work.
Under the new procedural rules, a farmers’ collective is a legal entity from the date of its registration with the General Farmers’ Union, enabling it to own movable and immovable assets. It is also exempt from any fees related to real estate registration, such as those for sales and taxes on real estate and building plot revenue.
The rules also oblige each member of a farmers’ collective to acquire a number of shares corresponding to the amount of land they own in the area where the collective works. Those who own fewer than eight hectares of irrigated land or orchards get one share per hectare of such land. Farmers with more than eight hectares get two shares for each additional hectare. Owners of no more than 30 hectares of rain-fed farmland get one share per three hectares of such land. The value of each share is SYP 1,000. These shares are registered under their owners’ names. However, creditors may seize these shares to ensure payment of debts owed by the collective.
The new procedural rules stipulate that members commit to providing their farming equipment and place them at the disposal of the collective, so that the group can use them. There is also a rule that each member must provide the land they own in the area where the collective works and place it at the collective’s disposal for management and investment, provided that ownership remains with that member.
In short, the collective’s lands are those that the members provide for collective investment, in addition to lands that the state may allocate to benefit the group and lands that have devolved to collective ownership. The collective’s lands are considered to be an integrated production unit. They may be divided into large fields to help increase productivity and usage of modern farming methods. Members of the collective share the responsibility for investing in these lands.
The collective must open a register of the names of landowning members, the type of their lands, the surface area and estimated value upon subscription. The collective is entitled to implement irrigation networks, roads, land reclamation, and construct buildings in locations required for production, so long as the general assembly’s decision approves these works.
Production costs are deducted from the collective’s net income. Around 17 percent of the group’s net income is also deducted: 10 percent for regulatory reserves and means of production, five percent for the social security and health fund, one percent for social and cultural affairs; and one person for rewards. Meanwhile, the remaining net income is distributed as follows: 70 percent for the members, based on the total working days each members provides, and 30 percent based based on the percentage of land each member has placed at the collective’s use.
The collective grants certain rewards to its members, such as securing short-term loans, issuing savings bonds for emergencies, disability insurance, insurance against losses, theft or fire, social security, social assistance, and marketing the group’s surplus production – that is, production beyond the personal consumption needs of the members.
However, joining a collective deprives farmers of their right to use their land, regardless of its size, because they have provided it to the collective. The new procedural rules overlook the process for returning a piece of land to its owner upon termination of their membership in the collective. Membership ends upon withdrawal or death if the collective dissolves when the number of members dips below 30, if it merges with another collective or if its work is at a loss. The new rules also failed to address the condition of the land upon return to its owner, and how the owner would be compensated in cases of damage to their land.
A member withdrawing from their collective with the approval of the general assembly has the right to obtain the land they provided to the collective, or land of equal value if handing over their original property would impede the group’s investment operations. In short, the landowner might not receive the same piece of land they had initially placed at the collective’s disposal for collective use. In this case, the withdrawing member may sell their land to another collective member or a third party, so long as that third party joins the collective. Under the procedural rules, the withdrawing member may not sell their land if it was originally agrarian reform land or state-owned land. If a member of the collective dies, their rights are liquidated with the heirs in line with any relevant regulations and laws in force, and in this case, they are treated the same as a withdrawing member.