There are essential differences between farmers' cooperatives and ordinary industrial and commercial enterprises.

Farmers 'cooperatives are essentially different from ordinary industrial and commercial enterprises. The main way to distinguish and distinguish the two is to see how their economic interests are set up. There are two main ways: one is to see whether it maintains the household management of farmers, and the other is to see whether it is profitable externally and "non-profit economic organization" internally. The former is the foundation of farmers 'cooperatives, while the latter embodies the basic nature and function of cooperatives, that is, all profits of cooperatives should ultimately be shared by all members. According to the law, profit-sharing is mainly achieved through "second rebates" based on a large proportion of the transaction volume between members and cooperatives, and free services such as technology, training and management for members. Qinglong Pig Breeding Cooperative in Santai County, Sichuan Province is a typical example of a real farmer cooperative. Their system design is ingenious and simple, which is impressive.

1. There are not many farmers 'cooperatives worthy of the name

As of the end of February 2014, more than 1 million farmers 'professional cooperatives had been registered in China, China Industry and Commerce Daily reported. However, it is clear to both the industry and the theoretical community that among such a large number of "cooperatives," there are not many genuine farmers 'cooperatives.

In fact, the way to distinguish farmers 'cooperatives from ordinary agricultural companies is very simple, that is, to see how their economic interests are set up. There are two main ways: to see whether they maintain the family management of farmers. Only by maintaining family management can farmers sell their own agricultural products to cooperatives and share the profits after unified sales or processing sales by cooperatives according to the sales volume (or sales ratio)(China's Law on Farmers 'Professional Cooperatives stipulates that the proportion of such "secondary rebates" shall not be less than 60% of the distributable surplus). Without family management, peasant households lose their qualifications to participate in the production and management activities of cooperatives, and the principles of "taking peasants as the main body,""serving members as the purpose,""democratic management" and "democratic decision-making" stipulated by law of peasant cooperatives have no foundation.

Second, see whether it is profitable externally and "non-profit economic organization" internally. Unlike ordinary industrial and commercial enterprises,"farmers 'cooperatives do not have the requirement of maximizing profits themselves, but they seek to maximize the interests of their members." For this reason, it seeks to maximize profits for all members externally and distributes profits internally according to the principle of equality and fairness. Therefore, the nature of farmers 'cooperatives in all countries of the world is defined as' non-profit organizations with no profit as their purpose 'and this is taken as the basic basis for enjoying preferential government policies." Therefore, all profits of a true peasant cooperative are ultimately shared by all its members (mainly through "secondary rebates" in large proportion to the volume of transactions between members and the cooperative and the provision of services such as technology, training, and management to members free of charge); on the contrary, if the cooperative brings its exclusive profits to the founding entities such as "capable large shareholders," leading enterprises, or various companies, it is not a true peasant cooperative.

In fact, these nominal "cooperatives" are all common "agricultural companies" belonging to ordinary industrial and commercial enterprises, while the so-called "cooperatives" with land as shares are actually "land leasing agricultural companies". These agricultural companies are all needed by the market economy. They have positive significance for organizing farmers, realizing agricultural industry aggregation and implementing agricultural industrialization. Even from the point of view of the peasant cooperative system, their economic function cannot be denied.

The reality is that they should not be registered as "farmers 'professional cooperatives" but as ordinary industrial and commercial enterprises. Of course, as ordinary industrial and commercial legal persons, not cooperative legal persons, they cannot occupy and enjoy the preferential policies of the state for farmers 'cooperatives.

There are four main reasons for this kind of reality dislocation: (1) The Regulations on Registration and Management of Farmers 'Professional Cooperatives in China does not stipulate the substantive elements of farmers' cooperatives, such as the lack of the above-mentioned "second rebate" and its proportion. In fact, the Law on Farmers 'Professional Cooperatives has already stipulated these substantive elements, and it is reasonable that the supporting "Registration Regulations" will no longer be "repeated". However, in the specific registration affairs, the local industrial and commercial administrative departments did not strictly distinguish between real farmers 'cooperatives and ordinary industrial and commercial enterprises in accordance with the Law on Farmers' Professional Cooperatives, which left loopholes for those "fake cooperatives" that "intercepted the preferential policies of the state for farmers 'cooperatives." (2) The procedures and procedures for registration of farmers 'cooperatives by grass-roots industrial and commercial departments are often simplified on the basis of company registration, lacking targeted procedures and systems, especially the "annual inspection" system for identifying genuine farmers' cooperatives according to the two substantive requirements mentioned above. (3) The window staff of the industrial and commercial department lack the basic knowledge of farmers 'cooperatives and do not understand the essential difference between "cooperative legal person" and "industrial and commercial legal person". Their understanding of farmers 'cooperatives mainly comes from their understanding of companies, so they do not have the ability to distinguish between true and false cooperatives. (4) In addition, the mainstream economic theory does not fully understand the farmer cooperative system, which is a more profound reason.

II. Typical examples of genuine farmers 'cooperatives

Faced with the reality that there are not many genuine farmers 'cooperatives, although the author is somewhat depressed, he still hopes to find such "rare" things as real cooperatives in the real world so that they can be displayed to the academic community. For this reason, the author (two researchers of farmers 'cooperatives) conducted an investigation in many places in Sichuan at the beginning of 2014. It is satisfactory and unexpected that during this period, we found two typical farmers' cooperatives that really run cooperatives according to law. Qinglong Pig Breeding Cooperative in Santai County is the most typical one.

"Qinglong Pig Breeding Cooperative" is located in Qinglong Village, Liuying Town, Santai County, Sichuan Province. The cooperative was established in April 2008 with 23 initial members. In 2009, it developed to 213, and the number of members remained stable at 328 in recent two years.

The cooperative meets the two basic conditions mentioned above for a true farmer cooperative, namely, maintaining the household management of farmers and sharing the profits of the cooperative with all members. According to accounting principles, about 70% of the cooperative's distributable profits are "second rebates" based on the volume of transactions between members and cooperatives, but their "second rebates" are very clever and simple.

This is mainly manifested in two aspects. First, the cooperative will directly leave the price difference between piglet and feed purchased by members (the price purchased by members from the cooperative is about 10% lower than the market price) to the members. For large breeding households (200~300 pigs), the price difference of feed in one year alone will form a "rebate" income of about 40,000 ~ 60,000 yuan. Second, the cooperative directly leaves the price difference of live pig sales (the cooperative sells live pigs under the brand of "Qinghe Brand" about 5% higher than the ordinary market price) to its members. The "rebate" income formed by the sales price difference directly improves the income level of the members in the period when the pig market is good, and plays a role in reducing losses and stabilizing production in the season when the pig market is bad. The distinctive feature of the pig industry is that the seasonal and annual market fluctuations are large, only in the market downturn "bear" to survive losses, it is possible to achieve better profits in the good period.