The “Law on Social Economy”, adopted on August 2015 defines social economy as ‘the collection of activities organised independently of the public sector, which serve a general interest, the interests of a community or personal non-commercial interests through the increase of the employment rate amongst vulnerable groups and/ or the production and provision of goods and services (Art 2(1)).1

According to the text, “social economy” is based on several principles inter alia (Art 3):

  • Priority of social objectives over profit making;
  • Convergence between the interests of the affiliated members and the general interest of the society/ community;
  • Democratic governance;
  • Distinct legal entity, with managerial autonomy and independence from the public sector. A social enterprise is defined as any juridical entity of private law which undertakes activities which fall under the social economy sphere and which respects the above listed principles (Art 5(d)). It can include:
  • Cooperative societies which operate under Law 1/2005;
  • Credit cooperatives regulated by the Government Ordinance no 99/2006;
  • Associations and foundations regulated by the Government Ordinance no. 26/2000, amended and completed by Law 246/2005;
  • Mutual aid associations for salaried employees regulated by Law 122/1996;
  • Mutual aid associations for pensioners regulated by Law 540/2002;
  • Any other legal entities operating under the principles of social economy listed above.

The law stipulates that each social enterprise should be certified by the public employment agency at a county level.

An additional category of social enterprise namely ‘social insertion enterprise’ is also introduced by the law.

Social enterprises of insertion are considered those social enterprises that:

  • permanently have at least 30% of staff belonging to the vulnerable group, so as the cumulative working time of these employees represents at least 30% of the total working time of all employees;
  • target the fight against exclusion, discrimination and unemployment through social and professional insertion of disadvantaged people.

Furthermore, the insertion social enterprises have an obligation to ensure, for employees who belong to the vulnerable group, accompaniment measures to guarantee the professional and social insertion.