State and municipal unitary enterprises: features, advantages, disadvantages

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:43

What are state and municipal unitary enterprises? In Russian legislation, in particular, in the Civil Code, there is a definition of this term. In accordance with it, state and municipal unitary enterprises are organizations created to solve the main tasks of the state and make a profit, but at the same time they are not owners of the property assigned to them.

Only the founder has the right to dispose of it directly. They are called unitary because property cannot be divided into shares, shares, deposits and other parts. The name of this subject must necessarily contain an indication of the owner.

State and municipal unitary enterprises are divided into 2 types. The first is organizations based on the right of economic management. It should be noted that this includes such unitary enterprises as municipal ones. They are created after the adoption of the relevant decision by the authorizedgovernment agency or municipality.

The second type is organizations based on the right of operational management. They can be founded only by decision of the government of the country. State and municipal unitary enterprises in this case have a rather specific position in the legal aspect. So, they are created for the purpose of providing certain services, performing work or producing any product, which is typical for commercial organizations. At the same time, all activities of the enterprise can be based on financing from the budget.

State (municipal) unitary enterprises. Features

First of all, this type of economic entities has a special legal capacity. That is, they are created for the purpose of performing certain work, providing services or producing some kind of product, which is a characteristic feature of commercial organizations. Nevertheless, state and municipal unitary enterprises are by no means limited in their rights to make certain transactions. For example, they can rent vacant premises (unless otherwise provided by the charter and other regulations).

Another feature is that such economic entities are individual enterprises.

The third specific feature of this type of enterprise is related to the Civil Code. Particular attention is paid to terminology. In relation to such organizations, the definition of "enterprise" isa subject of civil rights, in other cases it is only an object of legal relations.

Among other things, they can qualify for targeted funding (this includes subsidies, subsidies, and subventions). It is used to run a variety of programs. Preference is given to those with a social focus.

From here follows the fourth feature. The charter of economic entities of a unitary type must include information about the direct owner of the property, the sources of formation of the authorized capital and the procedure for its formation. It should be noted that the enterprise is not responsible for the obligations of the owner, but he is responsible for the activities of the organization.

Management of unitary enterprises

Here there is a sole manager, not a collegial body, as is the case in other cases. Typically, this is the director. A person for this position is appointed by the owner or a special body with the appropriate authority.

Advantages and disadvantages of this form of economic entities

Let's first consider the positive aspects of unitary enterprises. Firstly, they are designed to solve those issues that are relevant in society at a given time. Secondly, they are more sustainable (compared to other commercial enterprises). This is due to the fact that they, as a rule, operate in industries whose level of profitability is not of interest to privateentrepreneurs, respectively, there is no competition. In addition, state support protects these entities from ruin. Another advantage is the timely payment of wages, predictability.

Now, a few words about disadvantages.

First of all, unitary enterprises are less efficient from an economic point of view. Also, a constant level of remuneration leads to a decrease in its productivity, loss of interest on the part of employees, since there is no competent motivational component. It is also important that at these facilities the use of property for personal gain, theft, and a high degree of bureaucracy are quite common.

Thus, it can be said that it is advisable to create unitary enterprises only in those areas where the use of other forms is less effective.