Page 122 - Social Enterprise A New Business Paradigm for Thailand

Interior and Safety), the Consumer Cooperatives Act of 1999 (The Fair Trade Commission), and
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the Framework Act on Cooperatives (FAC).
Among these nine laws, the Framework Act on Cooperatives (FAC) is the most frequently cited. It

provides the legal framework for the formation of small and medium-sized cooperatives across
sectors not covered by the other eight statutes. Establishing a cooperative under this law is less
demanding than under previous laws. Although cooperative organizations have existed in South
Korea since the early 20th century, grassroots-level cooperatives were difficult to form due to
legal requirements, most notably, a minimum of 200 founding members and startup capital of at
least USD 300,000. The FAC, which was enacted in 2011, significantly reduced these barriers by
allowing cooperatives to be established with just five founding members. This change led to a

rapid increase in the number of cooperatives. In the first five years after the law was enacted,
8,289 cooperatives were established. The number continued to grow, reaching 22,610 by
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February 2023.
One particularly notable development was the emergence of labor cooperatives. For example,
the Alternate Drivers’ Cooperative, which began informally in 2010, became the first labor
cooperative to officially register under the FAC in 2011. This cooperative provides drivers for
customers who are unable to drive themselves, typically due to alcohol consumption. Every night,
numerous “alternate drivers” work on call under difficult conditions. Forming a cooperative

allowed them to organize collectively, coordinate operations online, and conduct their work more
86
efficiently. As of February 2023, there were 693 labor cooperatives registered under the FAC.
Another rapidly growing type of cooperative is the social cooperative, established by service
providers who address unmet social needs, particularly in childcare and elder care. The
Framework Act on Cooperatives (FAC) requires that social cooperatives must register as non-
profit organizations. Additionally, they are required to allocate at least 40 percent of their income
toward public benefit purposes and are prohibited from distributing profits to their members. As
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of 2022, there were 3,660 registered social cooperatives.

84 International Cooperative Alliance – Asia and Pacific, Cooperatives in Korea, Source: https://icaap.coop > Korea
Snapshots,
August 2024.
85 Minsun Ji, How Policy is Building a Social Economy in South Korea, Nonprofit Quarterly, op. cit.
86 Ibid,
87 Ibid,
89