A new boost for the Social Economy
Parliament has passed a new law that modernises the regulatory framework for cooperatives, promotes digitalisation, strengthens equality and improves their financial flexibility.
On 26 March, the plenary session of the Lower House of the Spanish Parliament passed the Comprehensive Law on the Promotion of the Social Economy, which provides an updated regulatory framework for a business model that includes more than 127,000 organisations, generates 2.5 million jobs and accounts for 11.1% of Spain’s GDP.
A comprehensive step forward
For cooperatives, this offers progress in various areas compared to the provisions of the 1999 Cooperatives Act.
- Addressing digital transformation, the new legislation grants legal validity to remote participation in general assemblies and governing councils and formally authorises electronic communication with members. It also introduces a requirement for cooperatives with more than 500 members to have a corporate website.
- With regard to equality, the legislation requires a balanced gender representation in governing bodies and makes it compulsory to have an Equality Committee and a Cooperative Equality Plan.
- In order to safeguard the integrity of the sector, this new legislation tightens governance standards and introduces new grounds for administrative disqualification as a measure to prevent “bogus cooperatives”.
- On the financial front, greater financial flexibility is granted to institutions by allowing the exceptional use of the Education and Promotion Fund in the event of natural disasters or liquidity crises.
Finally, this law promotes social inclusion by making it easier for people in vulnerable situations to access such organizations, offering them the option to defer payment of their compulsory contribution to a cooperative.
