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NATIONAL ASSEMBLY
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SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
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Law No. 68/2014/QH13
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Hanoi, November 26, 2014
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LAW
ON ENTERPRISES
Pursuant to Constitution of
Socialist Republic of Vietnam;
The National Assembly
promulgates the Law on enterprises.
Chapter
I
GENERAL PROVISIONS
Article
1. Scope
This Law deals with the
establishment, organization, restructuring, dissolution, and relevant
activities of enterprises, including limited liability companies, joint-stock companies,
partnerships, sole proprietorships, and groups of enterprises.
Article
2. Regulated entities
1. Enterprises.
2. Agencies, organizations,
and individuals involved in the establishment, organization, restructuring,
dissolution, and relevant activities of enterprises.
Article
3. Application of the Law on Enterprises and specialized laws
If specialized laws contain
regulations on establishment, organization, restructuring, dissolution, and
relevant activities of enterprises, such regulations shall apply.
Article
4. Interpretation of terms
In this Law, the terms below
are construed as follows:
1. Foreigner means any
person who does not have Vietnamese nationality.
2. Shareholder means
any individual or organization that owns at least a share of a joint-stock
company.
Founding shareholder means any shareholder that
owns at least an ordinary share and whose signature is on the list of founding
shareholders of the joint-stock company.
3. Dividend means a net
profit paid to each share in cash or other assets from the residual profit of
the joint-stock company after all financial obligations are fulfilled.
4. Limited liability
companies include single-member limited liability companies and
multi-member limited liability companies.
5. National business registration
portal means a website used for online business registration and access of
information about business registration.
6. National Enterprise
Registration Database means a collection of data about business
registration nationwide.
7. Enterprise means an
organization that has its own name, assets, office, and is registered in
accordance with law to do business.
8. State-owned company means
any enterprise of which 100% charter capital is held by the State.
9. Vietnamese company
means any enterprise that is established or registered under Vietnam’s law and
has its headquarter located in Vietnam.
10. Permanent residence means
the address of the organization’s headquarter or address of the individual’s
permanent residence, workplace, or another location that is registered by such
person with the enterprise as contact.
11. Market price of a stake
or share means the highest price on the market on the previous day, the
price agreed between the seller and the buyer, or the price determined by a
professional valuation organization.
12. Certificate of Business
registration means a paper or electronic file issued by the business
registration authority to the enterprise which contains information about
business registration.
13. Capital contribution
means the contribution of assets to form the company’s charter capital. Capital
contribution is either contribution of capital to establish a new enterprise or
contribution of additional capital to an existing enterprise.
14. National business
registration information system comprises the National Enterprise
Registration Database, national business registration portal, and the system
infrastructure.
15. Valid application means
an application that contains adequate documents as prescribed in this Law, and
information on which are declared sufficiently as prescribed by law.
16. Business means the
continuous execution of one, some, or all of stages of the investment process
such as manufacturing, selling products or services on the market to earn
profit.
17. Related person means
any organization or individual that has a direct or indirect relationship with
the enterprise, including the following cases:
a) The parent company, the
manager of the parent company, and the person competent to designate such
manager are related persons of subsidiaries in the same group;
b) Subsidiaries are related
person of the parent company in the same group;
c) The person or a group of
people who can influence the decision making and operation of the enterprise
via a managerial body;
d) The enterprise manager;
dd) Spouse, parents, adoptive
parents, children, adopted children, brothers-in-law, sisters-in-law of the
enterprise manager or the members/partners/shareholders who have the
controlling stake or shares;
e) Any person authorized to
represent one of the persons or companies mentioned in Points a, b, c, d, and
dd of this Clause;
g) The enterprise in which the
persons or companies mentioned in Points a, b, c, d, dd, e, and h of this
Clause have enough holding to influence the decision making of the managerial
bodies of such enterprise;
h) A group of people who have
an agreement to acquire stakes, shares, or interests of the company to have
influence over the decision making of the company.
18. Enterprise managers
is the manager of the company or manager of sole proprietorship, who is either
an owner of a sole proprietorship, a general partner, the Chairpersons of the
Board of members, a member of the Board of members, the company's President,
the Chairperson of the Board of Directors, a member of the Board of Directors,
the Director/General Director, or a person holding another managerial position
who is entitled to enter into the company’s transactions on behalf of the
company according to the company’s charter.
19. Founder means any
organization or individual that establishes or contributes capital to establish
an enterprise.
20. Foreign investor
means any organization or individual that is defined as a foreign investor
according to the Law on Investment.
21. Stake means the
total value of assets that a member/partner contributes or promises to
contribute to a limited liability company or partnership. Stake holding means
the ratio of a member/partner’s stake to charter capital of the limited
liability company or partnership.
22. Public services/products
are services/products necessary for life and socio-economic conditions of the
country or communities of certain areas that the State must provide to ensure
common interests or National defense and security; the investment in
manufacturing and supply of such services/products under market mechanism is
not likely to be recouped.
23. Company member
means any individual or organization that holds part or all of charter capital
of a limited liability company or partnership.
24. Members of a
partnership include general partners and capital contributors
25. Enterprise
restructuring is either a total division, partial division, consolidation,
acquisition of an enterprise, or conversion of the type of business entity.
26. Foreign organization means
any organization that is established overseas under another country’s law.
27. Foreign investors’
holding means the total holding of voting capital of all foreign investors
in a Vietnamese company.
28. Voting capital means the
stake or shares under the ownership of a person who has the right to vote on
the issues within the competence to decide the Board of members or the General
Meeting of Shareholders.
29. Charter capital means
the total value of assets that are contributed or promised to be contributed by
members/partners when establishing a limited liability company or partnership;
or the total face value of shares that are sold or registered when establishing
a joint-stock company.
Article
5. State assurance about enterprises and owners of enterprises
1. The State recognizes the
continued existence and development of types of business entities defined in
this Law; ensures the legal equality of enterprises regardless of their forms
and economic sectors; and acknowledges the legitimate profitability of
business.
2. The State recognizes and
protects the ownership of assets, capital, income, other lawful rights and
interests of enterprises and owners of enterprises.
3. Legitimate assets and
capital of enterprises and enterprise owners shall not be nationalized and
shall not be administratively confiscated.
The State shall purchase or
requisition enterprises’ assets for reasons of National defense and security,
national interests, state of emergency, natural disaster response, and pay
enterprises according to market prices at such times. The payment or
compensation must ensure enterprises’ interests without discrimination between
types of business entities.
Article
6. Political organizations and socio-political organizations within enterprises
1. Political organizations and
socio-political organizations within enterprises shall operate in accordance
with Constitution, law, and the organization’s charter.
2. Enterprises must not
obstruct the establishment of intramural political organizations or
socio-political organizations and must not obstruct employees to participate in
such organizations.
Article
7. Rights of enterprises
1. Engage in the business
lines that are not prohibited by law.
2. Exercise business autonomy;
decide on organizational structure, business lines, and location; change the
scale and business lines.
3. Decide on the method of
raising and using capital.
4. Find markets, customers,
and sign contracts proactively.
5. Engage in export and
import.
6. Hire employees to serve the
business.
7. Apply science and technologies
to improve business efficiency and competitiveness.
8. Own, use, and dispose of
assets of the enterprise.
9. Refuse to provide resources
against the law.
10. Lodge complaints and
denunciations in accordance with regulations of law on complaints and
denunciations.
11. Participating in
proceedings in accordance with laws.
12. Other rights prescribed by
relevant laws.
Article
8. Obligations of enterprises
1. Satisfy the conditions when
engaging in the business lines subject to business conditions as prescribed by
the Law on Investment; maintain the fulfillment of such conditions throughout
the business operation.
2. Do accounting, make and
submit truthful financial statements in a timely manner according to
regulations of law on accounting and statistics.
3. Declare, pay taxes and
fulfill other financial obligation as prescribed by law.
4. Ensure the lawful rights
and interests of employees according to regulations of law on employment; do
not show discriminatory behaviors or insult employees in the enterprise; do not
employ children and forced labour; provide support for and enable employees to
have professional training; buy social insurance, unemployment insurance,
health insurance, and other types of insurance for employees.
5. Ensure and take responsibility
for quality of goods/services according to standards prescribed by law or
registered/announced standards.
6. Fulfill obligations
pertaining to business registration, changes of business registration
information, disclosure of information about the enterprise establishment and
operation, and other obligations prescribed in this Law and relevant laws.
7. Take responsibility for the
truthfulness and accuracy of information in the application for business
registration and reports; rectify incorrect information.
8. Comply with regulations of
law on national defense and security, social order and safety, gender equality,
protection of natural resources, the environment, historic sites and natural
monuments.
9. Exercise the obligations
pertaining to business ethics to protect the lawful rights and interests of
customers and consumers.
Article
9. Rights and obligations of enterprises providing public services/products
1. The rights and obligations
specified in Article 7, Article 8, and relevant regulations of this Law.
2. Get reimbursed for the
costs in accordance with regulations of law on bidding, or collect service
charges in accordance with regulations of competent authorities.
3. Provide products/services
for a period of time sufficient to recoup investment and earn a reasonable
amount of profit.
4. Provide products/services
according to agreed quantity, quality, and time limits at the prices or charges
decided by competent authorities.
5. Ensure equitability and
equally convenience of customers.
6. Take legal responsibility
for the quantity, quality, conditions, prices/charges of the products/services
provided.
Article
10. Criteria, rights and obligations of social enterprises
1. Every social enterprise
must satisfy the following criteria:
a) The enterprise is
registered in accordance with this Law;
b) The enterprise's objective
is to resolve social, environmental problems, or to serve public interests;
c) At least 51% of annual
profit is used for reinvestment in order to serve the social, environmental
purposes as registered.
2. Apart from the rights and
obligations of enterprises prescribed in this Law, social enterprises also have
the following rights and obligations:
a) Maintain the objectives and
conditions prescribed in Point b and Point c Clause 1 of this Article
throughout the operation; any operating enterprise that wishes to convert into
a social enterprise, and any social enterprise that wishes to stop operating as
a social enterprise shall notify the competent authority to complete necessary
procedures;
b) Owners and managers of
social enterprises shall be enabled to obtain licenses and relevant
certificates as prescribed by law.
c) Seek and receive
sponsorships from other individuals, enterprises, non-governmental
organizations, other Vietnamese and foreign organizations to cover
administrative expense and operating costs of the enterprise;
d) Do not use the sponsorships
for purposes other than covering administrative expense and operating costs or
resolving social, environmental issues registered by the enterprise;
dd) Submit annual reports on
the enterprise’s operation to the competent authority when receiving incentives
or support.
3. The State shall introduce
policies to encourage, support, and boosts the development of social
enterprises.
4. The Government shall
elaborate this Article.
Article
11. Retention of enterprise’s documents
1. Depending on the form, the
enterprise must retain the following documents:
a) The company’s charter;
internal rules and regulations; member register or shareholder register;
b) Certificate of industrial
property rights; Certificate of product quality registration; other licenses
and certificates;
c) Documents proving the
company’s ownership of its assets;
d) Minutes of meetings of the
Board of members, the General Meeting of Shareholders, the Board of Directors;
the enterprise’s decisions;
dd) The prospectus for
securities issuance;
e) Reports made by the Control
Board; conclusions of inspection authorities; conclusions of audit
organizations;
g) Accounting books,
accounting documents, and annual financial statements.
2. The documents mentioned in
Clause 1 of this Article must be kept at the headquarter or another location
prescribed in the company’s charter. The retention duration shall comply with
relevant regulations of law.
Article
12. Reporting changes to information about the enterprise's manager
The enterprise must notify the
business registration authority of the changes to the name, address,
nationality, ID number, passport number or other ID papers of the following
persons within 05 days from the day on which such changes are made:
1. Members of the Board of
Directors of the joint-stock company;
2. Members of the Control
Board or controllers;
3. The Director or General
Director.
Article
13. Legal representative
1. The legal representative of
an enterprise is the individual that exercises the rights and fulfills the
obligations on when making transactions on behalf of the enterprise, represents
the enterprise as the plaintiff, defendant, and person with relevant interests
and duties before the arbitral tribunal, the court, exercises other rights and
fulfills other obligations as prescribed by law.
2. A limited liability company
or joint-stock company may have one or multiple legal representatives. The quantity,
titles, rights and obligations of legal representative of the enterprise shall
be specified in the company’s charter.
3. There must always be at
least one legal representative that resides in Vietnam. If the enterprise has
only one legal representative, such person must resides in Vietnam and
authorizes another person in writing to perform the legal representative’s
right and obligations when leaving Vietnam. In this case, the legal
representative is still responsible for the performance of delegated rights and
obligations.
4. In case the legal
representative does not return to Vietnam at the end of the authorization
period and does not give another authorization:
a) The authorized person of
the sole proprietorship shall keep performing the legal representative’s rights
and obligations within the scope of authorization until the legal
representative goes back to work at the enterprise;
b) The authorized person of
the limited liability company, joint-stock company, or partnership shall keep
performing the legal representative’s rights and obligations within the scope
of authorization until the legal representative goes back to work at the
enterprise, or until the company owner, the Board of members, or the Board of
Directors decides to designate another person as the legal representative of
the enterprise.
5. If the enterprise has only one legal
representative and such person is not present in Vietnam for more than 30 days
without authorizing another person to act as the legal representative, or such
person is dead, missing, detained, sentenced to imprisonment, or legally
incompetent, then the company owner, the Board of members, or the Board of
Directors shall designate another person as the legal representative.
6. With regard to a limited
liability company with two members, if the member who is the legal
representative of the company is detained or sentenced to imprisonment, makes a
getaway, is missing or legally incompetent, or is banned from
practicing by the court for smuggling, producing counterfeits, running illegal
businesses, tax evasion, fraud, or another crime defined by Criminal Code, the
other member is naturally the company’s legal representative until the Board of
members makes a decision on company’s legal representatives.
7. In some special cases, the
Court is entitled to appoint the legal representative during the proceedings.
Article
14. Responsibilities of the enterprise’s legal representative
1. The enterprise’s legal
representative has the following responsibilities:
a) Perform the given rights
and obligations in a truthful, careful manner to ensure the enterprise’s lawful
interests;
b) Act in the best interest of
the enterprise; do not use information, secrets, business opportunities of the
enterprise; do not misuse the position, power, or property of the enterprise
for self-seeking purposes or serving the interest of other entities;
c) Notify the enterprise of
the representative and his/her related persons owning or having the controlling
stake or shares in other enterprises.
2. The legal representative of
the enterprise is personally responsible for the damage caused by his/her
violations against the obligations mentioned in Clause 1 of this Article.
Article
15. Authorized representatives of owners, members, shareholders being organizations
1. The authorized
representatives of owners, members, shareholders being organizations must be
individuals authorized in writing to perform their rights and obligations
prescribed in this Law on behalf of such owners, members, shareholders.
2. Unless otherwise prescribed
by the company’s charter, the authorized representative shall be appointed as
follows:
a) A multi-member limited
liability company that holds at least 35% of charter capital may appoint up to
03 representatives;
b) A joint-stock company that
holds at least 10% of ordinary shares may appoint up to 03 representatives.
3. If the owner, member, or
shareholder being an organization appoints multiple authorized representatives,
the stake/shares of each representative must be determined. If the owner,
member, or shareholder fails to determine the stake/shares of each authorized
representative, the stake/shares shall be split equally among the
representatives.
4. Authorized representatives
must be appointed in writing; the appointment of authorized representative must
be notified to the company and is only effective when the company receives the
notification. The letter of authorization must contain:
a) Full name, enterprise
identification number, address of the headquarter of the owner, member, shareholder;
b) The quantity of authorized
representatives and their corresponding holding of shares/stake;
c) Full name, permanent
residence, nationality, ID number, passport number of each authorized
representative;
d) The duration of
authorization of each representative, including the beginning date;
dd) Full names, signatures of
legal representatives, owners, members, shareholders, and authorized
representatives.
5. Authorized representatives
must satisfy the conditions below:
a) The authorized representative
is legally competent;
b) The authorized
representative is not prohibited from establishing and managing enterprises;
c) Members, shareholders being
companies of whom >50% of charter capital is held by the State in the form
of stake or shares must not appoint their spouses, parents, adoptive parents,
children, adopted children, siblings of the manager or the person competent to
appoint the company manager as authorized representatives of other companies;
d) The authorized
representative satisfies other conditions prescribed by the company’s charter.
Article
16. Responsibilities of authorized representative of owners, members,
shareholders being organizations
1. The authorized
representatives of owners, members, shareholders being organizations shall perform
the rights and obligations of owners, members, and shareholders on their behalf
at the Board of members or the General Meeting of Shareholders in accordance
with this Law. All restrictions imposed by owners, members, shareholders upon
the authorized representative’s performance of the rights and obligations of
being owners, members, and shareholders shall not apply to any third party.
2. Authorized representatives
must attend every meeting of the Board of members or the General Meeting of
Shareholders; perform given rights and obligations in a truthful and careful
manner to protect the lawful interests of the authorizing owners, members and
shareholders
3. Authorized representatives
are responsible to owners, members, shareholders being organizations for
failure to fulfill the obligations prescribed in this Article. The authorizing
owners, members, and shareholders are responsible to the third party for the
responsibility pertaining the rights and obligations performed by the
authorized representatives.
Article
17. Prohibited acts
1. Issuing or refusing to
issue the Certificate of Business registration; requesting business founders to
submit additional documents against this Law; delaying, obstructing, harassing
business founders or enterprises’ operation.
2. Obstructing owners,
members, shareholders of enterprises performing the obligations and rights
prescribed in this Law and the company’s charter.
3. Doing business as an
enterprise without registration; carrying on doing business after the
Certificate of Business registration has been revoked.
4. Providing untruthful
information in the application for enterprise registration or application for
adjustments to business registration.
5. Declaring false charter
capital; failure to contribute sufficient charter capital as registered;
deliberately determining inaccurate values of contributed assets.
6. Engaging in prohibited
business lines; engaging in business lines subject to conditions without
satisfying all of the conditions as prescribed in the Law on Investment, or
failing to maintain fulfillment of such conditions throughout the business
operation.
7. Money laundering, fraud.
Chapter
II
ENTERPRISE ESTABLISHMENT
Article
18. The right to establish enterprises, contribute capital, purchase
shares/stakes, and manage enterprises
1. Every organization and
individual is entitled to establish and manage enterprises in Vietnam in
accordance with this Law, except for the cases in Clause 2 of this Article.
2. The following entities are
not permitted to establish and manage enterprises in Vietnam:
a) Government agencies, armed
force units using state-owned property to establish enterprises for
self-seeking purposes.
b) Officials and civil
servants defined by regulations of law on officials and civil servants;
c) Commissioned officers,
non-commissioned officers, workers and civil servants working at units of the
army; commissioned officers, non-commissioned officers working at police units,
except for those appointed as authorized representatives to manage state capital
contributed to other enterprises;
d) Executive officers of
state-owned companies, except for those appointed as authorized representatives
to manage state capital contributed to other enterprises;
dd) Minors; people that are
legally incompetent; organizations without legal status;
e) Any person facing criminal
prosecution, serving a prison sentence, undergoing drug rehabilitation, sent to
a reform school; or banned from doing business, holding a certain title or
doing a certain job by the court; and other cases prescribed by regulations of
law on bankruptcy and anti-corruption.
The applicant for enterprise
registration must submit the criminal record to the business registration
authority at its request.
3. Every organization and
individual is entitled to contribute capital, buy shares/stakes in joint-stock
companies, limited liability companies, and partnerships in accordance with
this Law, except in the following cases:
a) Government agencies, armed
force units using state-owned property to establish enterprises for
self-seeking purposes;
b) The entities banned
prohibited from contributing capital to enterprises as prescribed by
regulations of law on officials and civil servants.
4. Self-seeking purpose
mentioned in Point a Clause 2 and Point a Clause 3 of this Article means the
use of income, in any shape or form, earned from doing business, capital
contribution, purchase of shares/stakes for any of the purposes below:
a) The income is distributed,
in any shape or form, among some or all of the persons mentioned in Point b and
Point c Clause 2 of this Article;
b) The income is used to
increase the budget of the organization/unit against regulations of law on
government budget;
c) The income is added to a
fund serving private interests of the organization/unit.
Article
19. Contracts prior to business registration
1. The founder of the
enterprise may sign contracts serving the establishment and operation of the
enterprise before and during the process of business registration.
2. If the enterprise
establishment is permitted, the enterprise shall keep performing the duties and
rights under the concluded contracts, unless otherwise agreed by the parties.
3. If the enterprise
registration is not granted, the person who enters into the contract prescribed
in Clause 1 of this Article shall take responsibility, or the founder of the
enterprise shall take joint responsibility for the implementation of the
contract.
Article
20. Application for registration of a sole proprietorship
1. An application form for
business registration.
2. Copies of the ID card or
other ID papers of the owner of the sole proprietorship.
Article
21. Application for registration of a partnership
1. An application form for
business registration.
2. The company’s charter.
3. A list of partners.
4. Copies of the ID card or
other ID papers of the partners.
5. A copy of the Certificate
of Investment registration of the foreign investors as prescribed by the Law on
Investment.
Article
22. Application for registration of a limited liability company
1. An application form for
business registration.
2. The company’s charter.
3. A list of members.
4. Copies of:
a) Copies of the ID card or
other ID papers of members being individuals;
b) Decision on Establishment,
Certificate of Business registration, or an equivalent document of the
organization and the letter of authorization; the ID card or other ID papers of
the authorized representatives of members being organizations.
If a member is a foreign
organization, the copy of the Certificate of Business registration or an
equivalent document must be consularly legalized.
c) The Certificate of
Investment registration of the foreign investors as prescribed by the Law on
Investment.
Article
23. Application for registration of a joint-stock company
1. An application form for
business registration.
2. The company’s charter.
3. A list of founding
shareholders and shareholders being foreign investors.
4. Copies of:
a) Copies of the ID card or
other ID papers of founding shareholders and foreign investors being individuals;
b) Decision on Establishment,
Certificate of Business registration, or an equivalent document of the
organization and the letter of authorization; the ID card or other ID papers of
the authorized representatives of founding shareholders and foreign investors
being organizations.
If shareholders are foreign
organizations, the copy of the Certificate of Business registration or an
equivalent document must be consularly legalized.
c) The Certificate of
Investment registration of the foreign investors as prescribed by the Law on
Investment.
Article
24. Contents of the application form for business registration
1. Name of the enterprise.
2. Address of the enterprise’s
headquarter; phone number, tax number, and email address (if any).
3. Business lines.
4. Charter capital; capital
invested by the owner of the sole proprietorship.
5. Types of shares, face value
of each type of shares and total authorized shares of each type if the
enterprise is a joint-stock company.
6. Tax registration
information
7. Number of employees.
8. Full name, signature,
permanent residence, nationality, number of the ID card, passport, or another
ID paper of the owner if the enterprise is a sole proprietorship, or those of
the partners if the enterprise is a partnership.
9. Full name, signature,
permanent residence, nationality, number of the ID card, passport, or another
ID paper of the legal representative if the enterprise is a limited liability
company or joint-stock company.
Article
25. The company’s charter.
1. The company’s charter
consists of the charter upon registration and amendments made to the charter
throughout the enterprise’s operation.
Main contents of the company’s
charter:
a) Name, address of the
headquarter of the enterprise; names, addresses of its branches and representative
office (if any);
b) Business lines;
c) Charter capital; total
shares, types of shares, and nominal values of each type of shares if the
enterprise is a joint-stock company;
d) Full names, addresses,
nationalities, and other information of general partners if the enterprise is a
partnership; of the owners or members if the enterprise is a limited liability
company; of founding shareholders if the enterprise is a joint-stock company;
stakes of each member if the enterprise is a limited liability company or
partnership; the quantity of shares, types of shares, and nominal value of each
type of the founding shareholders;
dd) Rights and obligations of
members/partners if the enterprise is a limited liability company/partnership;
of shareholders if the enterprise is a joint-stock company;
e) Organizational structure;
g) The legal representative if
the enterprise is a limited liability company or a joint-stock company;
h) Method for ratifying the
enterprise’s decisions; rules for resolution of internal dispute;
i) Bases and methods for
determination of wages and bonus for managers and controllers;
k) Cases in which a member is
entitled to request the enterprise to buy his/her stake (if the enterprise is a
limited liability company) or shares (if the enterprise is a joint-stock
company);
l) Rules for distribution of
post-tax profit and handling of business loss;
m) Cases of dissolution;
procedures for dissolution and asset liquidation;
n) Rules for making amendments
to the company’s charter.
2. When applying for business
registration, the charter must bear the full names and signatures of the
following persons:
a) General partners if the
enterprise is a partnership;
b) The enterprise’s owner
being an individual or the legal representative of the enterprise’s owner being
an organization (if the enterprise is a single-member limited liability
company);
c) Members being individuals
or legal representatives or authorized representatives of the members who are
organizations (if the enterprise is a multi-member limited liability company);
c) Founding shareholders being
individuals and legal representative or authorized representative of founding
shareholders being organizations if the enterprise is a joint-stock company.
3. The amended charter must
bear the full names and signatures of the following persons:
a) The President of the Member
assembly if the enterprise is a partnership;
b) The owner, legal
representative of the owner, or the legal representative if the enterprise is a
single-member limited liability company;
c) The legal representative if
the enterprise is a multi-member limited liability company or joint-stock
company.
Article
26. List of members of a limited liability company, general partners of a
partnership, founding shareholders of a joint-stock company
The list of members of a
limited liability company, general partners of a partnership, founding
shareholders of a joint-stock company must have the following information:
1. Full names, signatures,
addresses, nationalities, permanent residence, and other information about
members/general partners being individuals if the enterprise is a limited
liability company or partnership; of founding shareholders and foreign
investors being individuals if the enterprise is a joint-stock company;
2. Names, enterprise
identification number, and addresses of members/general partners being
organizations if the enterprise is a limited liability company or partnership;
of founding shareholders and foreign investors being organizations if the
enterprise is a joint-stock company;
3. Full names, signatures,
addresses, nationalities, permanent residences of authorized representatives or
legal representatives of members being organizations if the enterprise is a
limited liability company; of founding shareholders and foreign investors being
organizations if the enterprise is a joint-stock company;
4. Stakes, types, quantity and
value of each type of contributed assets, time limit for making capital
contribution of each member/general partner if the enterprise is a limited liability
company or partnership; quantity of shares, types of shares, types, quantity
and value of each type of assets contributed by each founding shareholders and
shareholders being foreign investors if the enterprise is a joint-stock
company.
Article
27. Procedures for business registration
1. The founder of the
enterprise or an authorized person shall submit the application for enterprise
registration prescribed in this Law to the business registration authority
2. The business registration
authority shall consider the legitimacy of the application for enterprise
registration and issue the Certificate of Business registration within 03
working days from the day on which the application is received. If the
application is rejected, a written notification must be sent to the founder.
The notification must provide explanation and necessary adjustments or
additions.
3. The Government shall
specify the procedures and documents for business registration, cooperation
among regulatory bodies in issuance of Certificate of Business registration,
employment registration, social insurance, and online business registration.
Article
28. Issuance of the Certificate of Business registration
1. The enterprise shall be
granted the Certificate of Business registration when the following conditions
are satisfied:
a) The registered business
lines are not banned;
b) The enterprise’s name is
conformable with regulations in Articles 38, 39, 40, and 42 of this Law;
c) The application for
business registration is satisfactory;
d) The fee for enterprise
registration is fully paid as prescribed by regulations of law on fees and
charges.
2. If the Certificate of
Business registration is lost or damaged or otherwise destroyed, the enterprise
shall have it reissued and pay fees as prescribed by law.
Article
29. Contents of the Certificate of Business registration
1. Name and identification
number of the enterprise.
2. Address of the enterprise’s
headquarter.
3. Full name, signature,
permanent residence, nationality, number of the ID card, passport, or another
ID paper of the legal representative if the enterprise is a limited liability
company or joint-stock company; or general partners if the enterprise is a
partnership; of the owner if the enterprise is a sole proprietorship; full
names, permanent residences, nationalities, ID/passport numbers of members
being individuals, or names, enterprise identification numbers and addresses of
headquarters of members being organizations if the enterprise is a limited
liability company.
4. Charter capital.
Article
30. Enterprise identification number
1. Enterprise identification
number is a series of number created by the National Business Registration
Information System which is issued to the enterprise when it is established and
written on the Certificate of Business registration. Each enterprise has a sole
enterprise identification number and it shall not be issued to any other
enterprise.
2. The enterprise
identification number is used when fulfilling tax obligations, following
administrative procedures, and performing other rights and obligations.
Article
31. Registration of changes to the Certificate of Business registration
1. The enterprise must
register with the business registration authority when contents of its
Certificate of Business registration are changed as prescribed in Article 29 of
Law.
2. The legal representative of
the enterprise must register the changes to the Certificate of Business
registration within 10 days from the day on which such changes are made.
3. The business registration
authority shall consider the legitimacy of the documents and issue a new
Certificate of Business registration within 03 working days from the day on
which the application is received. If the application is rejected, a written
notification must be sent to the applicant. The notification must
provide explanation and necessary adjustments or additions.
4. Changes to the Certificate
of Business registration according to a decision of the court or arbitration
shall be registered following the procedures below:
a) The applicant for changes
to the Certificate of Business registration shall submit the application to the
business registration authority within 15 working days from the effective date
of the judgment or decision. The application must be enclosed with a copy of
the effective judgment or decision;
b) The business registration
authority shall consider and issue a new Certificate of Business registration
according to the effective judgment or decision within 03 working days from the
day on which the application is received. If the application is rejected, a
written notification must be sent to the applicant. The notification must
provide explanation and necessary adjustments and additions.
Article
32. Notification of changes to the business registration information
1. The enterprise must notify
the business registration authority when making any of the changes below:
a) Changing the business
lines;
b) Changing the founding
shareholders if the enterprise is a joint-stock company and shareholders being
foreign investors, unless the enterprise is a listed company;
c) Making other changes to the
application for enterprise registration.
2. The legal representative of
the enterprise shall notify changes to business registration information within
10 days from the day on which such changes are made.
3. The company must send a
written notification to the business registration authority of the
administration division where the enterprise’s headquarter is located from the
day on which shareholders being foreign investors, whose names are in the
enterprise’s shareholder register, are changed. The notification must specify:
a) The enterprise’s name,
enterprise identification number, address of the headquarter.
b) With regard to shareholders
being foreign investors who transfer their shares (the transferors): Names and
addresses of foreign shareholders being organizations; full name,
nationalities, addresses of shareholders being individuals; their holdings and
quantity of shares, types of shares; quantity and types of transferred shares;
c) With regard to shareholders
being foreign investors who receive shares transfer (the transferees): Names
and addresses of foreign shareholders being organizations; full name,
nationalities, addresses of shareholders being individuals; quantity and types
of shares received; quantity of shares and corresponding holdings in the
company;
d) Full name and signature of
the company’s legal representative.
4. The business registration
authority shall consider the legitimacy of the documents and change business
registration information within 03 working days from the day on which the
notification is received. If the changes are rejected, a written notification
must be sent to the applicant. The notification must provide explanation and
necessary adjustments and additions (if any).
5. Changes to business
registration information according to a decision of the court or arbitration
shall be registered following the procedures below:
a) The applicant for changes
to business registration information shall submit the notification of changes
to a competent business registration authority within 10 working days from the
effective date of the judgment or decision. The notification must be enclosed
with a copy of the effective judgment or decision;
b) The business registration
authority shall consider and change the business registration information
according to the effective judgment or decision within 03 working days from the
day on which the notification is received. If the changes are rejected, a
written notification must be sent to the requester. The notification must
provide explanation and necessary adjustments and additions.
Article
33. Announcing business registration information
1. After being granted the
Certificate of Business registration, the enterprise must make an announcement
on the National Business Registration Portal and pay the fee as prescribed. The
announcement shall contain the information on the Certificate of Business
registration and the following information:
a) The business lines;
b) A list of founding
shareholders and shareholders being foreign investors if the enterprise is a
joint-stock company.
2. If business registration
information is changed, the changes must be announced on National Business
Registration Portal by the deadline prescribed in Clause 3 of this Article.
3. Announcement of the
information prescribed in Clause 1 and Clause 2 of this Article must be
announced within 30 days from the day on which it is disclosed.
Article
34. Provision of business registration information
1. Within 05 working days from
the day on which the Certificate of Business registration is issued or business
registration information is changed, the business registration authority shall
send the business registration information or the changes to business
registration information to the tax authority, statistical agency, labor
authority, and social insurance authority; periodically send business
registration information and changes to business registration information to
another regulatory body of the same level, the People’s Committee of the
district where the enterprise’s headquarter is located.
2. Every organization or
individual is entitled to request business registration authorities to provide
information that must be announced by enterprises as prescribed by law.
3. Business registration
authorities must provide information sufficiently and in a timely manner as
prescribed in Clause 2 of this Article.
4. The Government shall
elaborate this Article.
Article
35. Contributed assets
1. Contributed assets may be
Vietnam Dong (VND), convertible foreign currencies, gold, value rights to use
land, value of intellectual property rights, technologies, technical secrets,
and other assets that can be assessed in VND.
2. Intellectual property
rights contributed as capital include copyrights and relevant rights,
industrial property rights, plant variety rights, and other intellectual
property rights prescribed by regulations of law on intellectual property. Only
the organizations and individuals who are legitimate owners of the
aforementioned rights may contribute such assets as capital.
Article
36. Transfer of ownership of contributed assets
1. Members of limited
liability companies, general partners of partnerships, and shareholders of
joint-stock companies must transfer the right to ownership of assets
contributed as capital as follows:
a) If asset ownership
registration is mandatory or the asset is land use right, the capital
contributor must follow procedures for transferring the ownership of such asset
or land use right to the company at a competent authority.
The transfer of ownership of
contributed assets shall not incur registration fee;
b) If asset ownership
registration is not mandatory, the capital contribution shall be recorded in
writing.
The transfer record must
specify the name and headquarter address of the company; Full name, permanent
residence, ID/passport number, establishment decision number or registration
number of the contributor; the types and quantity of assets contributed; total
value of contributed assets and ratio of contributed assets to the company’s
charter capital; the date of transfer; signatures of the contributor or the
contributor's authorized representative and the legal representative of the
company;
c) Shares or stakes in the form
of assets other than VND, convertible foreign currency, and gold are considered
transferred after the legal ownership of such assets is transferred to the
company.
2. Contributed assets used for
the sole proprietorship’s operation is exempt from procedures for ownership
transfer.
3. Payments for transfer of
shares/stakes, and receipt of dividends of foreign investors must be made
through their capital accounts opened at banks in Vietnam, except for payment
with assets.
Article
37. Assessing contributed assets
1. Contributed assets other
than VND, convertible foreign currencies, gold, must be assessed by
members/general partners, founding shareholders, or professional valuation
organizations, and expressed in VND.
2. Assets contributed upon the
enterprise establishment must be unanimously assessed by members or founding
shareholders, or assessed by a professional valuation organization. If assets
are assessed by a professional valuation organization, the value of contributed
assessed must be concurred with by the majority of members or founding
shareholders.
If a contributed asset is
assessed at a higher value than its true value at the time of contribution, the
members or founding shareholders shall contribute an additional amount which is
equal to the difference between the assessed value and true value when the
valuation is done; and are jointly responsible for the damage caused by
deliberate assessment of assets higher values than their actual values.
3. Assets contributed during
the operation shall be assessed by the owner, the Board of members (if the
enterprise is a limited liability company or partnership), or the Board of
Directors (if the enterprise is a joint-stock company) and the contributor or a
professional valuation organization. If the asset is assessed by a professional
valuation organization, its assessed value must be concurred with by the
contributor and the enterprise.
If the assessed value is higher than the true
value of the asset at the time of contribution, the contributor, the owner, members
of the Board of members (if the enterprise is a limited liability company or
partnership), or members of the Board of Directors (if the enterprise is a
joint-stock company) shall contribute an additional amount which is equal to
the difference between the assessed value and true value when the valuation is
done; and are jointly responsible for the damage caused by deliberate assessment of
assets higher values than their actual values.
Article
38. Enterprise’s name
1. The Vietnamese name of an
enterprise consists of two elements:
a) The type of business
entity. The type of business entity is written as “công ty trách nhiệm hữu hạn”
or “công ty TNHH” (limited liability company); “công ty cổ phần” or “công ty
CP” (joint-stock company); “công ty hợp danh” or “công ty HD” (partnership);
“doanh nghiệp tư nhân”, “DNTN” or “doanh nghiệp TN” (sole proprietorship);
b) The proper name is written
using the Vietnamese alphabet, the letters, F, J, Z, W, digits, and symbols.
2. The enterprise’s name must
be post up at the headquarter, branches, representative offices, and other
business locations of the enterprise. The enterprise’s name must be printed or
written on transaction documents, materials, and publications published by the
enterprise.
3. Business registration
authorities are entitled to refuse to grant approval for enterprises’ names
pursuant to Articles 39, 40, 42, and this Article.
Article
39. Prohibitions when naming enterprises
1. Picking a name that is the
same as or confused with another enterprise’s name which has been registered as
prescribed in Article 42 of this Law.
2. Using names of regulatory
bodies, the armed forces, political organizations, socio-political
organizations, socio-political-professional organizations, social
organizations, socio-professional organizations as the whole or part of the
enterprise’s proper name, unless otherwise permitted by the organization.
3. Using words or symbols that
offend the history, tradition, culture of Vietnam.
Article
40. Enterprise’s name in foreign language and abbreviated name
1. Enterprise’s name in
foreign language means the name translated from the Vietnamese name into a
foreign language that uses the Latin alphabet. When translated into a foreign
language, the enterprise’s name may be kept unchanged or translated into a word
or phrase with a corresponding meaning.
2. If the enterprise has a foreign name, it
size must be smaller than the enterprise’s Vietnamese name at the headquarter,
branches, representative offices, business locations of the enterprise, on the
enterprise’s documents and publications.
3. Abbreviated name of a
enterprise may derived from the Vietnamese name or the foreign language name.
Article
41. Names of branches, representative offices, and business locations
1. Names of branches, representative
offices, and business locations must be written using the Vietnamese alphabet,
the letters F, J, Z, W, digits, and symbols.
2. The name of each branch or
representative office must bear the enterprise’s name and the word “Chi nhánh”
(“Branch of”) or “Văn phòng đại diện” (“Representative office”)
3. Names of branches,
representative offices, and business locations must be put up at the branches,
representative office, and business locations. The name of the branch or
representative office must be smaller than the enterprise’s name on the
documents issued by the branch or representative office.
Article
42. Used names and confusing names
1. A used name means a
Vietnamese name chosen by a enterprise which is exactly the same as the name of
another registered enterprise.
2. A name is considered
confusing in the following cases:
a) The Vietnamese name chosen
by the enterprise is pronounced similarly to the name of a registered
enterprise;
b) The abbreviated name chosen
by the enterprise is the same as the abbreviated name of a registered
enterprise;
c) The foreign language name
chosen by the enterprise is the same as the foreign language name of a
registered enterprise;
d) The proper name chosen by
the enterprise is different from that of a registered enterprise of the same
type by only a digit or a letter (in the Vietnamese alphabet, or the letter F,
J, Z, W) right after the chosen proper name;
dd) The proper name chosen by
the enterprise is different from that of a registered enterprise of the same type
by only a symbol “&”, “.”, “+”, “-”, “_”;
e) The proper name chosen by
the enterprise is different from that of a registered enterprise of the same
type by only a the word “tân” (“new”) before or “mới” after the proper name;
g) The proper name chosen by
the enterprise is different from that of a registered enterprise of the same
type by only a word "miền Bắc” (”Northern”), “miền Nam” (”Southern”),
“miền Trung” (”Central”), “miền Tây” (”Western”), “miền Đông” (”Eastern”), or a
word with similar meanings.
Regulations in Points d, dd,
e, and g of this Clause do not apply to subsidiaries of a registered
enterprise.
Article
43. Headquarter
The headquarter of a
enterprise is a location in Vietnam with an address, which consists of the
house number, street, commune, district, province, phone number, fax number,
and email address (if any).
Article
44. Enterprise’s seal
1. Every enterprise is
entitled to decide the form, quantity, and contents of its seal. A seal must
specify:
a) The enterprise’s name;
b) The enterprise’s ID number.
2. Before using the seal, the
enterprise must send the seal design to the business registration authority in
order for the business registration authority to post it on the National
Business Registration Portal.
3. The management, use, and
retention of the seal shall comply with the company’s charter.
4. The seal shall be used in
the cases prescribed by law or agreed by the parties.
5. The Government shall
elaborates this Article.
Article
45. Branches, representative offices, and business locations of the enterprise
1. A branch is a unit
dependent on the enterprise and obliged to perform part or all of the
enterprise’s functions, including representation under authorization. The
business lines of the branch must be consistent with those of the enterprise.
2. A representative office is
a unit dependent on the enterprise and obliged to represent the enterprise’s
interests under authorization and protect such interests.
3. Business location is a
place where the enterprise does some particular business activities.
Article
46. Establishment of branches, representative offices
1. Every enterprise is
entitled to establish a branch or representative office, whether at home or
overseas. A enterprise may establish one or multiple branches/representative
offices in an administrative division.
2. When establishing a
branch/representative office in Vietnam, the enterprise shall submit an
application for establishment of the branch/representative office to a
competent business registration authority in charge of the administrative
division where the branch/representative office is situated. The application
consists of:
a) A notification of the
branch/representative office establishment;
b) A copy of the Establishment
Decision and minutes of the meeting about the branch/representative office
establishment; a copy of the ID card/passport or ID paper of the head of the
branch/representative office.
3. The business registration
authority shall examine the validity of the application and issue the
Certificate of Branch/Representative Office Registration within 03 working days
from the day on which the application is received. If the application is
rejected, the enterprise must be notified in writing. The notification must
provide explanation and necessary adjustments/supplementation (if any)
4. The business registration
authority that issues the Certificate of branch/representative office
registration shall inform the business registration authority in charge of the
administrative division where the enterprise’s headquarter is situated, send
information about registration of the branch/representative office to the tax
authority, statistics authority within 05 working days from the issuance date
of the Certificate of branch/representative office registration; periodically
send information to the People’s Committee of the district where the
branch/representative office is situated.
5. The legal representative of
the enterprise shall register changes to the Certificate of
Branch/Representative Office Registration within 10 days from the day on which
such changes are made.
6. The Government shall
elaborates this Article.
Chapter
III
LIMITED LIABILITY COMPANY
Section
1: MULTI-MEMBER LIMITED LIABILITY COMPANY
Article
47. Multi-member limited liability company
1. Multi-member limited
liability company is a enterprise where:
a) Members are organizations
and/or individuals; the number of members does not exceed 50;
b) Members are liable for
debts and other liabilities of the enterprise up to the value of capital they
contribute to the enterprise, except for the case in Clause 4 Article 48 of
this Law.
c) Stakes of members shall be
transferred in accordance with Articles 52, 53, and 54 of this Law.
2. A multi-member limited
liability company has a legal status from the issuance date of the Certificate
of Business registration.
3. Multi-member limited
liability companies must not issue shares.
Article
48. Capital contribution to company establishment and issuance of certificate
of capital contribution
1. Charter capital of a multi-member
limited liability company upon business registration is the total value of
capital contribution to the company promised by the members.
2. Every member must
contribute capital properly in terms of sufficiency and type of assets as
agreed within 90 days from the day on which the Certificate of Business
registration is issued. Company’s members may only contribute assets other than
the promised assets it such assets are approved by the majority of other
members. After the said deadline, each member has the rights and obligations
proportional to their promised capital contribution.
3. In case a member fails to
contribute capital or fails to fully contribute capital by the deadline
mentioned in Clause 2 of this Article:
a) The member who fails to contribute
capital as promised is obviously no longer a company’s member;
b) The member who fails to
fully contribute capital as promised shall have the rights proportional to
his/her contributed capital;
c) The right to contribute
capital of the member who fails to contribute capital shall be offered under a
decision of the Board of members.
4. If a member fails to
contribute capital or fails to fully contribute capital as agreed, the company
shall register a change to charter capital and the member’s stake holding
within 60 days from the deadline for making sufficient capital contribution
prescribed in Clause 2 of this Article. Any member who fails to contribute
capital or fails to fully contribute capital as agreed shall take
responsibility up to the value of promised capital contribution for the
company’s financial obligations incurred before the day on which the company
registers the changes to the charter capital and its members’ stakes.
5. When a member fully
contributes capital, the company shall issue a Certificate of capital
contribution to such member. The certificate of capital contribution shall
contains:
a) The enterprise’s name, ID
number, and headquarter address;
b) The enterprise’s charter
capital;
c) Full name, permanent
residence, nationality, ID/passport number if the member is an individual;
name, establishment decision number or company ID number, headquarter address
if the member is an organization;
d) The member’s stake and
value thereof;
dd) Number and date of issue
of certificate of capital contribution;
e) Full name and signature of
the company’s legal representative.
6. In case a certificate of
capital contribution is lost, damaged, or otherwise destroyed, its holder shall
has it reissued in accordance with the procedures provided for by the company’s
charter.
Article
49. Member register
1. The company shall make a
member register as soon as the Certificate of Business Registration is issued.
The member register shall contain:
a) The enterprise’s name, ID
number, and headquarter address;
b) Full names, permanent
residences, nationalities, ID/passport numbers of members being individuals;
names, establishment decision numbers or company ID numbers, headquarter
addresses of members being organizations;
c) Stakes and values thereof;
date of capital contribution, types of contributed assets; quantity and value
of each type of assets contributed by each member;
d) Signatures of members being
individuals or legal representatives of members being organizations;
dd) Numbers and dates of issue
of certificates of capital contribution of every member.
2. The member register shall
be kept at the company’s headquarter.
Article
50. Rights of members
1. Participate in meetings of
the Board of members; discuss, propose, votes for the issues within the competence
of the Board of members.
2. Cast a number of votes that
is proportional to the member’s stake, except for the case in Clause 2 Article
48 of this Law.
3. Receive a proportion of
profits that is proportional to the member’s stake after the company has
settled all taxes and fulfilled other financial obligations as prescribed by
law.
4. Receive a proportion of
remaining assets that is proportional to the member’s stake after the company
is dissolved or goes bankrupt.
5. Has the preemptive right to
contribute additional capital when the company’s charter capital is increased.
6. Dispose of his/her own
stake by transfer part or all of it, give, donate or otherwise in accordance
with law and the company’s charter.
7. File a lawsuit against the
President of the Member assembly, Director/General Director, legal
representative, or another manager in accordance with Article 72 of this Law,
whether single-handedly or on behalf of the company.
8. Except for the case in
Clause 9 of this Article, any member or group of members that owns at least 10%
of the charter capital (or a smaller amount prescribed by the company’s
charter) shall have the additional rights below:
a) Request meetings of the
Board of members to resolve issues within its competence;
b) Inspect, examine books and
monitors transactions, accounting books, and annual financial statements;
c) Inspect, examine, copy the
member register, meeting minutes, Resolutions of the Board of members, and
other documents of the company.
d) Request the Court to annul
the resolution of the Board of members within 90 days from the ending date of
the meeting if the procedures, conditions for meeting, or contents of such
resolution are not correct or not conformable with this Law and the company’s
charter.
9. If a company’s member owns
more than 90% of charter capital and the company’s charter does not provide for
a smaller rate as prescribed in Clause 8 of this Article, the group of other
members shall naturally have the rights prescribed in Clause 8 of this Article.
10. Other rights prescribed by
this Law and the company’s charter.
Article
51. Obligations of member
1. Contribute capital fully
and punctually; take liability for the debts and other liabilities of the
company up to the value of capital contributed, except for the cases in Clause
2 and Clause 4 Article 48 of this Law.
2. Do not withdraw contributed
capital in any shape or form, except for the cases in Articles 52, 53, 54, and
68 of this Law.
3. Comply with the company’s
charter.
4. Comply with resolutions and
decisions of the Board of members.
5. Take personal
responsibility when committing the following acts on behalf of the company:
a) Violations of law;
b) Business operations or
transactions that do not serve the company’s interests and cause damage for other
persons;
c) Payment of undue debts
while the company is facing financial risk.
6. Fulfill other obligations
prescribed by this Law.
Article
52. Repurchasing stakes
1. Every member is entitled to
request the company to repurchase his/her stake if such member votes against
the resolution of the Board of members on:
a) Amendments to the company’s
charter that are related to rights and obligations of members and/or the Board
of members;
b) Company restructuring;
c) Other cases prescribed by
the company’s charter.
The request for repurchase of
a stake must be made in writing and sent to the company within 15 days from the
day on which the Resolution is ratified as prescribed in this Clause.
2. When such a request is made
as prescribed in Clause 1 of this Article, if an agreement on the price is not
reached, the company shall repurchase the member’s stake at the market price or
at a price determined according to the company’s charter within 15 days from
the day on which the request is received. The payment shall only be made if the
company is still able to repay its debts and settle other liabilities after
paying for the stake.
3. If the company does not
repurchase the stake as prescribed in Clause 2 of this Article, the member is
entitled to transfer his/her stake to another member or a person other than
members.
Article
53. Transferring stakes
1. Except for the case in
Clause 3 Article 52, Clause 5 and Clause 6 Article 54 of this Law, every member
of multi-member limited liability company are entitled to transfer part or all
of his/her stake to another person as follows:
a) Offer the stakes to other
members in proportion to their stakes in the company under the same conditions;
b) Only transfer the stake
under the same conditions applied other members prescribed in Point a of this
Clause to persons other than members if the members do not buy or do not buy
completely within 30 days from the offering date.
2. The transferring member
still has the rights and obligations to the company in proportion to his/her
stake until information about the buy mentioned in Points b, c and d Clause 1
Article 49 of this Law is written on the member register.
3. If the transfer or change
of the stake causes the company to have only one member, the company shall be
converted into a single-member limited liability company and register the
business registration changes within 15 days from the day on which the
transferred is finished.
Article
54. Settlement of stakes in some special cases
1. If a member being an
individual dies, his/her inheritor according to the will or law shall be the
company’s member. If a member being an individual is declared missing by
court, his/her asset management according to civil law shall be the company’s
member.
2. If a member becomes legally
incompetent, his/her rights and obligations shall be performed by
his/her guardian.
3. A member’s stake shall be
transferred or repurchased by the company in accordance with Article 52 and
Article 53 of this Law in the following cases:
a) The inheritor does not wish
to become a member;
b) The recipient mentioned in
Clause 5 of this Article is not accepted by the Board of members as a member;
c) The member is an
organization that has been dissolved or bankrupt.
4. If a member being an
individual dies without an inheritor, the inheritor renounces the inheritance
or is disinherited, such stake shall be settled in accordance with civil law.
5. A member is entitled to
give part or all of his/her stake to another person.
The recipient is the member’s
spouse, parent, child, or a person within three ranks of inheritance, is
naturally the company’s member. If the recipient being another person shall
only become the company’s member if accepted by the Board of members.
6. If the member uses his/her
stake to pay debts, the recipient is entitled to use such stake to:
a) Become a company’s member
if accepted by the Board of members; or
b) Offer and transfer it in
accordance with Article 53 of this Law.
Article
55. Organizational structure
A multi-member limited
liability company has a the Board of members, a the Chairperson of the Board of
members, a Director/General Director. Every multi-member limited liability
company that has 11 members or more shall establish a the Control Board; a
company with fewer than 11 members may also establish a the Control Board if
necessary for the business administration. Rights, obligations, standards,
requirements, and conditions of the Control Board and Chief of the Control
Board shall be provided for in the company’s charter.
Article
56. The Board of members
1. The Board of members
consists of all company’s members and is the supreme decision-making body of
the company. The frequency of meetings of the Board of members shall be
specified by the company’s charter. Nevertheless, there must be at least one
meeting per year.
2. The Board of members has
the following rights and obligations:
a) Decide the annual business
plan and development strategy of the company;
b) Decide the increase or
decrease of charter capital; decide the time method for raising additional
capital;
c) Decide development
investment projects of the company;
d) Decide solutions for market
development; marketing, technology transfers; ratifying contracts for taking
loans, granting loans, selling assets of which the value is equal to or higher than 50% of total asset value written in the
latest financial statement (or a smaller rate or value prescribed by the
company’s charter);
dd) Elect, dismiss the
Chairperson of the Board of members; decide the designation of, dismissal of,
conclusion and termination of contracts with the Director/General Director,
Chief accountant, and other managers prescribed by the company’s charter;
e) Decide the salaries,
bonuses, and other benefits for the Chairperson of the Board of members,
Director/General Director, Chief accountant, and other managers prescribed by
the company’s charter;
g) Ratify annual financial
statements, plans for use and distribution of profit, or plans for loss
settlement of the company;
h) Decide the company’s
organizational structure
i) Decide establishment of
subsidiaries, branches, and representative offices;
k) Amend the company’s
charter;
l) Decide the company
restructuring;
m) Decide the dissolution or
petition for bankruptcy of the company;
n) Other rights and
obligations prescribed by this Law and the company’s charter.
3. If an individual being a
member of a limited liability company is detained, imprisoned, or derived for
the right to practice by the Court as prescribed by Criminal Code, such member
may authorize another person to participate in the Board of members of the
company.
Article
57. Chairperson of the Board of members
1. The Board of members shall
elect a member as the Chairperson. The Chairperson of the Board of members may
concurrently hold the position of the company’s Director/General Director.
2. The Chairperson of the
Board of members has the following rights and obligations:
a) Prepare the agenda and
operation plan of the Board of members;
b) Prepare the agenda,
contents, documents of meetings of the Board of members or for absentee voting;
c) Convene and chair meetings
of the Board of members or organize the absentee voting;
d) Carry out or organize
supervision of implementation of Resolutions of the Board of members;
dd) Sign Resolutions of the
Board of members on behalf of the Board of members;
e) Other rights and
obligations prescribed by this Law and the company’s charter.
3. The term of office of a the
Chairperson of the Board of members shall not exceed 05 years. The Chairperson
of the Board of members may be re-elected without term limit.
4. If the Chairperson of the
Board of members is absent or incapable of performing his/her rights and
obligations, he/she may authorize another member in writing to perform rights
and obligations of the Chairperson of the Board of members in accordance with
the company’s charter. If no member is authorized, one of the members of the
Board of members shall convene a meeting to elect one of the members to
temporarily perform rights and obligations of the Chairperson of the Board of
members under the majority rule.
Article
58. Meetings of the Board of members
1. The Board of members shall
be convened at the request of the Chairperson of the Board of members or a
member or group of member prescribed in Clause 8 and Clause 9 Article 50 of
this Article. Every meeting of the Board of members must be held at the
company’s headquarter, unless otherwise prescribed by the company’s charter.
The Chairperson of the Board
of members shall prepare the agenda, documents, and convene meetings of the
Board of members. Members may propose additional contents to the agenda in
writing. The proposal must contain:
b) The full name, permanent
residence, nationality, ID/passport number of if the member is an individual;
name, establishment decision number or company ID number, headquarter address
if the member is an organization; full name, signature of the member or the
member’s authorized representative;
b) Proportion of stake, number
and date of issue of the certificate of capital contribution;
c) Additional contents;
d) Reasons.
The Chairperson of the Board
of members must accept the proposal and change the agenda if such proposal is
valid and sent to the company’s headquarter at least 01 working day before the
meeting date; if a proposal is put forward right before the meeting, it shall
be accepted if the majority of the attending members approve.
2. Invitations to meetings of
the Board of members may be made in writing, by phone, fax, or another
electronic medium as prescribed by the company’s charter, and sent directly to
each member of the Board of members. The invitation must specify the time,
location, and contents of the meeting.
The agenda and documents must
be sent to the company’s members before the meeting takes place. Documents
related to amendments to the company’s charter, approval of the company’s
development orientation, approval of annual financial statements, restructuring
or dissolution of the company must be sent to the members at least 07 days
before the meeting date. Time limits for sending other documents shall be
prescribed by the company’s charter.
3. In case the Chairperson of
the Board of members fails to convene a meeting of the Board of members at the
request of a member/group of member prescribed in Clause 8 and Clause 9 Article
50 of this Law within 15 days from the day on which the request is received,
such member/group of member shall convene the meeting.
4. Unless otherwise prescribed
by the company’s charter, the convention of a meeting of the Board of members
prescribed in Clause 3 of this Article must be made in writing and contain the
following information:
a) Full names, permanent
residences, nationalities, ID/passport numbers of members being individuals;
names, establishment decision numbers or company ID numbers, headquarter
addresses of members being organizations; proportion of stake, number and date
of issue of the certificate of capital contribution of each member that makes
the request;
b) Reasons for convening the
meeting and issues that need solving;
c) Intended agenda;
d) Full names and signatures
of every member that makes the request or their authorized representatives.
5. If the request for
convention of a meeting of the Board of members does not contain sufficient
information as prescribed in Clause 4 of this Article, the Chairperson of the
Board of members shall send a written notification to the member/group of
member within 07 working days from the day on which the request is received.
In other cases, the
Chairperson of the Board of members shall convene a meeting of the Board of
members within 15 days from the day on which the request is received.
In case the Chairperson of the Board of
members fails to convene a meeting of the Board of members as prescribed, the
Chairperson shall be personally responsible for the damage to the company and
relevant members. In this case, the member/group of members that makes the request is
entitled to convene a meeting of the Board of members. Reasonable expenditures
for the convention and organization of the meeting of the Board of members
shall be reimbursed by the company.
Article
59. Conditions and formalities of meetings of the Board of members
1. A meeting of the Board of
members shall be convened when it is attended by a number of members that hold
at least 65% of charter capital; the specific ratio shall be prescribed by the
company’s charter.
2. If the conditions for
holding a meeting of the Board of members prescribed in Clause 1 of this
Article are not satisfied, the second meeting shall be held as follows unless
otherwise prescribed by the company’s charter:
a) The second meeting shall be
held within 15 days from the intended date of the first meeting. The second
meeting shall be held when it is attended by a number of members that hold at
least 50% of example;
b) If the conditions for
holding the second meeting of the Board of members prescribed in Point a Clause
2 of this Article are not satisfied, the third meeting shall be held within 10
working days from the intended date of the second meeting. In this case, the
meeting of the Board of members shall be held regardless of the number of
attending members and the amount of charter capital held by the attending
members.
3. Members, authorized
representatives of members shall attend and casts votes at meetings of the
Board of members. Meeting formalities and voting methods shall be prescribed by
the company’s charter.
4. The duration of a meeting session may be
extended where necessary to complete the agenda. Nevertheless, the duration
must not exceed 30 days from the beginning date.
Article
60. Resolutions of the Board of members
1. The Board of members shall
ratify the Resolutions within its competence through voting at the meeting,
absentee voting, or another voting method prescribed by the company’s charter.
2. Unless otherwise prescribed
by the company’s charter, the following issues shall be resolved through voting
at the meeting of the Board of members:
a) Amendments to the company’s
charter prescribed in Article 25 of this Law;
b) The company’s development
orientation;
c) Election, dismissal of the
Chairperson of the Board of members; designation, dismissal of Director/General
Director;
d) Approval for the annual
financial statement;
dd) Restructuring or
dissolution of the company.
3. Unless otherwise prescribed
by the company’s charter, the Resolution of the Board of members shall be
ratified at the meeting in the following cases:
a) It receives a number of
votes that represents at least 65% of total stakes of attending members, except
for the case in Point b of this Clause;
b) In case of a decision to
sell assets of which the value is ≥ 50% of total asset value according to the
latest financial statement (or a smaller ratio prescribed by the company’s
charter; in case of amendments to the company’s charter; in case of
restructuring or dissolution of the company, the resolution must receives a
number of votes that represents at least 75% of total stakes of attending
members
4. A member is considered to
have attended and cast votes at the meeting of the Board of members when such
person:
a) Attend and directly vote at
the meeting;
b) Authorize another person to
attend and cast votes at the meeting;
c) Attend and cast votes
through online meeting, cast electronic votes or use another electronic medium;
d) Send votes to the meeting
by post, fax, or email.
5. A Resolution of the Board
of members shall be ratified in the form of absentee voting if this method is
approved by a number of members that holds at least 65 % of charter capital.
The specific ratio shall be prescribed by the company’s charter.
Article
61. Minutes of meetings of the Board of members
1. Meetings of the Board of
members must be recorded in writing, audio recordings, or other electronic
media of recordings.
2. The minutes of the meeting
must be completed and ratified right before the end of the meeting. The minutes
must have the following content:
a) Time, location, purposes,
agenda of the meeting;
b) Full names, proportions of
stakes, numbers and issuance dates of certificates of capital contribution of
members or authorized representatives of members that attend the meeting; Full
names, proportions of stakes, numbers and issuance dates of certificates of
capital contribution of members or authorized representatives of members that
do not attend the meetings;
c) The issues discussed and
voted; summary opinions of members about each issue;
d) Total number of valid
votes, invalid votes, affirmative votes, and negative votes for each issue.
dd) The decisions ratified;
e) Full names and signatures
of the minutes maker and the chair of the meeting.
3. The minutes maker and the
chair of the meeting are jointly responsible for the accuracy and truthfulness
of the meeting minutes.
Article
62. Procedures for ratifying Resolutions of the Board of members by absentee
voting
Unless otherwise prescribed by
the company’s charter, the procedures for absentee voting to ratify a
Resolution shall be as follows:
1. The Chairperson of the
Board of members decides to collect absentee ballots from members of the Board
of members to cast to ratify the issues within its competence;
2. The Chairperson of the
Board of members shall organize the drafting, sending of reports on the issues
that need deciding, the Draft Resolution, and absentee ballots to members of
the Board of members;
3. The absentee ballot shall
contain:
a) Name, enterprise ID number,
headquarter address;
b) The full name, address,
Nationality, ID/passport number, stake holding of the member;
c) The issues and responses in
the following order: in favour, against, and abstentions;
d) Deadline for submitting the
absentee ballot;
dd) Full name and signature of
the Chairperson of the Board of members.
An absentee ballot that
contains sufficient information, bears the signature of the member, and is sent
to the company by the deadline is considered valid;
4. The Chairperson of the
Board of members shall organize the vote counting, make a vote counting report,
notify the result and the ratified decisions to members within 07 working days
from the deadline for submitting the enquiry form. The report on vote counting
result is as valuable as the minutes of meeting of the Board of members and
must contain the following information:
a) Purposes and the issue of
the absentee voting;
b) Full names, proportions of
stakes, numbers and issuance dates of certificates of capital contribution of
members or authorized representatives that submit valid absentee ballots; Full
names, proportions of stakes, numbers and issuance dates of certificates of
capital contribution of members or authorized representatives that do not
submit absentee ballots or that submit invalid absentee ballots;
c) The issues that need
voting; summary opinions of members about each issue (if any);
d) Total number of valid
absentee ballots, invalid absentee ballots, unsubmitted absentee ballots; total
number of valid forms with assenting opinions, those with dissenting opinions
with regard to each issue;
dd) The decisions ratified and
the corresponding ratio of votes;
e) Full name and signature of
the counter and the Chairperson of the Board of members. The counter and the
Chairperson of the Board of members are jointly responsible for the accuracy
and truthfulness of the report on vote counting result.
Article
63. Effect of Resolution of the Board of members
Unless otherwise prescribed by
the company’s charter, the Resolution of the Board of members shall be
effective from the day on which it is ratified or from its effective date
written therein.
In case a member/group of
member request the Court or arbitral tribunal to annul a ratified Resolution,
it is still effective until the decision of the Court or arbitral tribunal
comes into force.
Article
64. Director/General Director
1. The Director or General
Director of a company is the person who administer the everyday business
operation of the company and is responsible to the Board of members for the
performance of his/her rights and obligations.
2. The Director/General
Director has the following rights and obligations:
a) Organize the implementation
of Resolutions of the Board of members;
b) Decide the issues related
to the company’s everyday business operation;
c) Organize the implementation
of the company’s business plans and investment plans;
d) Promulgate the company’s
rules and regulations, unless otherwise prescribed by the company’s charter;
dd) Designate, dismiss the
company’s managerial positions, except for those within the competence of the
Board of members;
e) Sign contracts on behalf of
the company, except for those within the competence of the Board of members;
g) Propose organizational
structure plan;
h) Submit annual financial
statements to the Board of members;
i) Propose plans for use of
profits or loss settlement;
k) Hire employees;
l) Perform other rights and
obligations prescribed in the company’s charter, employment contract between
Director/General Director and the company according to the Resolution of the
Board of members.
Article
65. Standards and conditions of Director/General Director
1. The Director/General
Director must be legally competent and is not banned from
enterprise management as prescribed in Clause 2 Article 18 of this Law.
2. The Director/General
Director must have experience and qualifications in business administration,
unless otherwise prescribed by the company’s charter.
3. With regard to a subsidiary
of which over 50% of charter capital is held by the State in the form of stakes
of shares, apart from the standards and requirements in Clause 1 and Clause 2
of this Article, the Director/General Director must not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister,
brother-in-law, sister-in-law of the manager of the parent company and the
representative of state capital in such company.
Article
66. Wages, salaries, and bonuses for the Chairperson of the Board of members,
Director/General Director, and managers
1. The company shall pay
wages, salaries, and bonuses for the Chairperson of the Board of members,
Director/General Director, and other managers according to the business
outcomes.
2. The wages, salaries of the
Chairperson of the Board of members, Director/General Director, and other
managers shall be included in operating expense as prescribed by regulations of
law on corporate income tax, relevant regulations of law, and recorded as a separate
item in the annual financial statement.
Article
67. Contracts and transactions subject to approval by the Board of members
1. The following contracts and
transactions between the company and the following entities are subject to
approval by the Board of members:
a) Members, authorized
representatives of members, Director/General Director, company’s legal
representative;
b) Related persons of the
persons mentioned in Point a of this Clause;
c) The manager of the parent
company, the person competent to designate the manager of the parent company.
d) Related persons of the
persons mentioned in Point c of this Clause.
2. The person who concludes
the contract or makes the transaction must send a notification to members of
the Board of members and the Controller of the entities relevant to such
contract or transaction. The notification shall be enclosed with the draft
contract or main contents of the transaction to be made. Unless otherwise
prescribed by the company’s charter, the Board of members shall decide whether
to accept the contract/transaction within 15 days from the day on which the
notification is received. In this case, the contract/transaction shall be
accepted if it is approved by the majority of the members who represent at
least 65% of voting capital. Members who involve in the contract/transaction
must not vote.
3. The contract/transaction
carried out against the regulations in Clause 1 and Clause 2 of this Article
and causing damage to the company shall be annulled and dealt with as prescribed
by law. The person who concludes the contract or makes the transaction, members
involved and their related persons shall pay compensation for the damage
inflicted, return to the company the income from such contract/transaction
which is carried out against Clause 1 and Clause 2 of this Article or causes
damage to the company.
Article
68. Adjustment to charter capital
1. The company may increases
its charter capital in the following cases:
a) Capital contribution of
members is increased;
b) Capital contributions are
made by new members.
2. When increasing stakes of members, the
additional capital shall be split to the members according to their proportion
of stakes to the company’s charter capital. Every member may transfer the right
to contribute capital to another person as prescribed in Article 53 of this
Law. Any member who objects to the decision on increase of charter capital may
refuse to contribute more capital. In this case, the additional capital
contributed by the member shall be split among other members according to their
proportion of stakes to the company’s charter capital, unless otherwise agreed
among the members.
3. The company may decreases
its charter capital in the following forms:
a) Part of stakes is returned
to members according to their stake holding if the company has run for more
than 02 consecutive years from the date of business registration, provided the
debts and other liabilities can be paid after the return is made.
b) The company repurchases a
member’s stake as prescribed in Article 52 of this Law;
c) Charter capital is not
contributed fully and punctually by members as prescribed in Article 48 of this
Law.
4. Within 10 days from the
date of increase or decrease in charter capital, the company must send a
written notification to the business registration authority. The notification
shall contain:
a) Name, ID number,
headquarter address of the enterprise;
b) Charter capital, the
intended increase or decrease in charter capital;
c) Time, reasons, and methods
of increase or decrease;
d) Full name and signature of
the company’s legal representative
If charter capital is
increased, the notification must be enclosed with the Resolution and meeting
minutes of the Board of members. If charter capital is decreased, the
notification must be enclosed with the Resolution, meeting minutes of the Board
of members, and the latest financial statement. Business registration authority
shall update information about increase or decrease in charter capital within
03 working days from the day on which the notification is received.
Article
69. Conditions for profit distribution
The company shall only
distribute profits to its members when its business operation is profitable,
tax liability and other financial obligations are fulfilled in accordance with
law, debts and other liabilities can be paid after profit distribution.
Article
70. Withdrawal of returned stake or distributed profit
When a stake is returned due
to an decrease to charter capital against the regulations in Clause 3 Article
68 of this Law, or profits are distributed to members against the regulations
in Article 69 of this Law, the members must return the money or assets they
receive, or take joint responsibility for the debts and other liabilities of
the company until the amount of money or assets returned by the members is
equivalent to the decrease in capital or the distributed profits.
Article
71. Responsibilities of the Chairperson of the Board of members,
Director/General Director, legal representative, Controllers, and other managers
1. The Chairperson of the
Board of members, Director/General Director, legal representative, Controllers,
and other managers have responsibilities to:
a) Perform the given rights
and obligations in an honest, careful manner to serve the best legitimate
interests of the company;
b) Act in the best interest of
the company; not use the company’s business opportunities, information,
secrets; not abuse power or position; not use the company’s property for
self-seeking purpose or serve the interests of another entity;
c) Provide the company with
timely, sufficient, and accurate information about the enterprises in which
they and their related person own or have the controlling stake or shares;
d) Perform other rights and
obligations prescribed by law and the company’s charter.
2. The Director or General
Director must not increase salaries or pay bonuses if the company is not able
to pay due debts.
3. A notification of related
persons mentioned in Point c Clause 1 of this Article shall contain the
following information:
a) Names, enterprise
identification numbers, addresses of headquarters of the enterprises in which
they have stakes or shares; holding and time of ownership;
b) Names, enterprise
identification numbers, addresses of headquarters of the enterprises in which
their related persons have private ownership or joint ownership of shares or
stakes that make up over 10% of charter capital.
4. The information mentioned
in Clause 1 and Clause 3 must be declared within 05 working days from the day
on which relevant interests occur or change. The company shall compile a list
of related persons of the company and their transactions with the company. The
list must be kept at the company’s headquarter. Members, managers, controllers
of the company, and their authorized representative are entitled to examine and
copy part or all of the information mentioned in Clause 1 and Clause 3 of this
Article during working hours in accordance with the procedures in company’s
charter.
Article
72. Lawsuits against managers
1. Members of the company
shall, single-handedly or on behalf of the company, file liability or civil
lawsuits against the President of the Member assembly, Director/General
Director, legal representative, and other managers that commit violations
against the manager’s duties in the following cases:
a) The violations mentioned in
Article 71 of this Law;
b) Failure to adhere to or
acts against regulations of law or the company’s charter on given rights and
obligations; failure to implement or adequately, promptly implement Resolutions
of the Board of members;
c) Other cases defined by law
and the company’s charter.
2. Procedures for filing
lawsuits shall comply with regulations of law on civil proceedings.
3. The proceeding costs when a
member file a lawsuits on behalf of the company shall be included in the
company’s expense, unless such lawsuit is denied.
Section
2: SINGLE-MEMBER LIMITED LIABILITY COMPANY
Article
73. Single-member limited liability company
1. A single-member limited
liability company is a enterprise under the ownership of an organization or
individual (hereinafter referred to as the company’s owner; the company’s owner
is liable for the company’s debts and other liabilities up to the company’s
charter capital.
2. A single-member limited
liability company has its legal status from the issuance date of the
Certificate of Business registration.
3. Single-member limited
liability companies must not issue shares.
Article
74. Capital contribution to the company’s establishment
1. Charter capital of a single-member
limited liability company on the business registration date is total value of
assets promised to be contributed by the owner, which is written in the
company’s charter.
2. A owner shall make
contributions in accordance with the commitment upon enterprise registration
within 90 days from the issuance date of the Certificate of Business
registration in terms of value and types of assets.
3. If sufficient charter
capital is not fully contributed by the deadline mentioned in Clause 2 of this
Article, the owner shall register a change to the charter capital within 30
days from the deadline for fully contributing charter capital. In this case,
the owner shall take responsibility up to the value of promised capital
contribution for the company’s financial obligations incurred before the change
to charter capital is registered.
4. The owner, with his/her
entire property, shall take responsibility for the company’s financial
obligations, the damage caused by failure to contribute capital, or failure to
fully and punctually contribute capital.
Article
75. Rights of the company’s owner
1. The company’s owner has the
rights to:
a) Decide the contents of the
company’s charter; amend the company’s charter;
b) Decide the annual business
plans and development plans of the company;
c) Decide the organizational
structure; designate and dismiss the company’s manager;
d) Decide development
investment projects;
dd) Decide solutions for
market development, marketing, and technology;
e) Ratify contracts to take
loans, contracts to grant loans, and other contracts prescribed by the
company’s charter of which the values are equal to or higher than 50% of the
total asset value written in the latest financial statement of the company, or
a smaller rate prescribed by the company’s charter;
g) Decide the sale of assets
of which the values are equal to or higher than 50% of the total asset value
written in the latest financial statement of the company, or a smaller rate
prescribed by the company’s charter;
h) Decide increases to the
company’s charter capital; transfer part of or all of the company’s charter
capital to other organizations and/or individuals;
i) Decide the establishment of
subsidiaries, capital contributions to other companies;
k) Supervise and assess the
company’s business operation;
l) Decide the use of profit
after company’s tax liability and other financial obligations are fulfilled;
m) Decide the company’s
restructuring, dissolution, and petition for bankruptcy;
n) Withdraw the entire value
of the company’s asset value after the dissolution or bankruptcy process is
completed;
o) Exercise other rights
prescribed in this Law and the company’s charter.
2. The company’s owner being
an individual has the rights to:
a) Decide the contents of the
company’s charter; amend the company’s charter;
b) Decide the company’s
investments, business operation, and administration, unless otherwise
prescribed by the company’s charter;
c) Decide increases to the
company’s charter capital; transfer part of or all of the company’s charter
capital to other organizations and/or individuals;
d) Decide the use of profit
after company’s tax liability and other financial obligations are fulfilled;
dd) Decide the company’s
restructuring, dissolution, and petition for bankruptcy;
e) Withdraw the entire value
of the company’s asset value after the dissolution or bankruptcy process is
completed;
g) Exercise other rights
prescribed in this Law and the company’s charter.
Article
76. Obligations of the company’s owner
1. Contribute charter capital
fully and punctually.
2. Adhere to the company’s
charter.
3. Determine and separate
assets of the owner and those of the company. The company’s owner being an
individual must separate the expenditures of his/her own and his/her family
from those made in the position of the company's President, Director, or
General Director.
4. Comply with regulations of
law on contracts and relevant regulations of law on buying, selling, loaning,
borrowing, leasing, renting, and other transactions between the company and the
company’s owner.
5. The company’s owner may
only withdraw capital by transferring part of or all of the charter capital to
another organization or individual; when withdrawing part of or all of charter
capital contributed to the company using another method, the owner and relevant
organization or individual shall be jointly responsible for the debts and other
liabilities of the company.
6. The company’s owner must
not receive profit when the company fails to pay the due debts and other
liabilities.
7. Fulfill other obligations
prescribed in this Law and the company’s charter.
Article
77. Performance of the company’s owner’s rights in some special cases
1. When the owner transfers,
give part of the charter capital to another organization or individual
(hereinafter referred to as entity), or the company has a new member, the
company shall be converted into a multi-member limited liability company or
joint-stock company, register changes to business registration contents with
the business registration authority within 10 days from the date on which
capital is transfer, given, or the new member is admitted.
2. In case the company’s owner
being an individual is detained, sentenced to imprisonment, or deprived of the
right to practice by a court as prescribed by law, such member shall authorize
another person to perform the rights and obligations of the company’s owner.
3. If the company’s owner
being an individual dies, his/her inheritor according to the will or law shall
be the owner or member of the company. The company shall be converted
correspondingly and register changes to business registration contents within
10 days from the completion of the inheritance process.
If the company’s owner being
an individual dies without an inheritor or the inheritor renounces the
inheritance or has the right to inherit deprived, the owner’s stake shall be
settled in accordance with regulations of law on civil affairs.
4. In case the company’s owner
being an individual becomes legally incompetent, rights and obligations of
the company’s owner shall be performed by the guardian.
5. If the company’s owner
being an organization is dissolved or bankrupt, the recipient of the owner’s
stake shall become the owner or member of the company. The company shall be
converted correspondingly and register changes to business registration
contents within 10 days from the completion of the transfer process.
Article
78. Organizational structure of single-member limited liability company under
the ownership of an organization
1. A single-member limited
liability company under the ownership of an organization shall apply one of the
following organizational models:
a) The company's President,
Director/General Director, and Controller;
b) The Board of members,
Director/General Director, and Controller.
2. Unless otherwise prescribed
by the company’s charter, the Chairperson of the Board of members or the
company's President shall be the company’s legal representative.
3. Unless otherwise prescribed
by the company’s charter, the roles, rights and obligations of the Board of
members, the company's President, Director/General Director, and Controller
shall comply with this Law.
Article
79. The Board of members
1. Members of the Board of
members shall be designated and dismissed by the company’s owner; there will be
03 – 07 members, the term of office shall not exceed 05 years. The Board of
members, on behalf of the company, shall perform rights and obligations of the
company’s owner and the company, except for rights and obligations of the
Director/General Director; take legal responsibility to the company’s owner for
the fulfillment of rights and obligations in accordance with this Law and
relevant regulations of law.
2. Rights, obligations, and
working relationship between the Board of members and the company’s owner shall
comply with the company’s charter Decree relevant regulations of law.
3. The Chairperson of the
Board of members shall be designated by the owner or elected by the Board of
members under the majority rule following the procedures prescribed in the
company’s charter. Unless otherwise prescribed by the company’s charter, the
term of office, rights and obligations of the Chairperson of the Board of
members shall comply with Article 57 and relevant regulations of this Law.
4. The power and method to
convene meetings the Board of members shall comply with Article 58 of this Law.
5. A meeting of the Board of
members shall be held when it is attended at least two thirds of the members.
Unless otherwise prescribed by the company’s charter, each member shall have
one vote with the equal value. The Board of members may ratify decisions by
absentee voting.
6. A Resolution of the Board
of members shall be ratified when it is approved by a majority of the attending
members. Decisions on amendments to the company’s charter, restructuring of the
company, transfer of part of or all of the company’s charter capital must be
approved by at least three fourths of the attending members.
The Resolution of the Board of
members is effective from the day on which it is ratified or on the date
written thereon, unless otherwise prescribed by the company’s charter.
7. Every meeting of the Board
of members must be recorded in writing, audio recordings, or other electronic
media. Contents of minutes of meetings of the Board of members shall comply
with Article 61 of this Law.
Article
80. The company's President
1. The company's President is
designated by the owner. The company's President, on behalf of the company’s
owner, shall perform rights and obligations of the company’s owner and the
company, except for rights and obligations of the Director/General Director;
take legal responsibility to the company’s owner for the fulfillment of rights
and obligations in accordance with this Law, relevant regulations of law, and
the company’s charter.
2. Rights, obligations, and
working relationship between the company's President and the company’s owner
shall comply with the company’s charter, this Law, and relevant regulations of
law.
3. A decision of the company's
President’s on performance of rights and obligations of the company’s owner is
effective from the day on which it is ratified by the company’s owner, unless
otherwise prescribed by the company’s charter.
Article
81. Director/General Director
1. The Board of members or the
company's President shall designate or hire Director/General Director, the term
of office of whom does not exceed 05 years, to administer the company’s
everyday business operation. The Director/General Director is legally
responsible to the Board of members or the company's President for fulfillment
of his/her rights and obligations. The Chairperson of the Board of members,
other members of the Board of members, or the company's President may
concurrently hold the position of Director (General Director), unless otherwise
prescribed by law or the company’s charter.
2. The Director/General
Director has the following rights and obligations:
a) Organize the implementation
of decisions of the Board of members or the company's President;
b) Decide the issues related
to the company’s everyday business operation;
c) Organize the implementation
of the company’s business plans and investment plans;
d) Promulgate the company’s
rules and regulations;
dd) Designate, dismiss the
company’s managers, except for those under the management of the Board of
members or the company's President;
e) Sign contracts on behalf of
the company, except for those within the competence of the Chairperson of the
Board of members or the company's President;
g) Propose organizational
structure plan;
h) Submit annual financial
statements to the Board of members or the company's President;
i) Propose plans for use of
profits or loss settlement;
k) Hire employees;
l) Perform other rights and
obligations prescribed in the company’s charter, employment contract between
Director/General Director and the Chairperson of the Board of members or the
company's President.
3. The Director/General
Director must:
a) be legally competent and
not be any of the persons mentioned in Clause 2 Article 18 of this Law;
b) has qualifications and
actual experience of the company’s administration, unless otherwise prescribed
by the company’s charter.
Article
82. Controllers
1. The company’s owner shall
decide the number of controllers, designate controllers with terms of office
not exceeding 05 years, and establishment of the Control Board. Controllers are
legally responsible to the company’s owner for fulfillment of their rights and
obligations.
2. Controllers have the
following rights and obligations:
a) Inspect the legitimacy,
honesty, and cautiousness of the Board of members, the company's President, and
the Director/General Director during the performance of the owner’s rights and
business administration;
b) Verify financial
statements, business outcome reports, administration reports, and other reports
before submitting them to the company’s owner or relevant regulatory bodies;
submit verification reports to the company’s owner;
c) Propose solutions,
organizational structure, and business administration to the company’s owner;
d) Examine every document of
the company at the company’s headquarter, branch, or representative office.
Member of the Board of members, the company's President, Director/General
Director, and other managers are obliged to provide sufficient and timely
information about the performance of the owner’s rights and business operation
at the request of Controllers;
dd) Attend and discuss at
meetings of the Board of members and other meetings of the company;
e) Perform other rights and
obligations prescribed in the company’s charter or at the request, under
decisions of the company’s owner.
3. Controllers must:
a) be legally competent and
is not any of the persons mentioned in Clause 2 Article 18 of this Law;
b) not be related persons of
members of the Board of members, the company's President, Director/General
Director, and the person competent to directly designate Controllers;
c) has qualifications in and
experience of accounting, audit, or qualifications in and actual experience of
the company’s business lines, or satisfy other standards and conditions
prescribed in the company’s charter.
4. The company’s charter shall
specify the contents and method of cooperation among Controllers.
Article
83. Responsibilities of members of the Board of members, the company's
President, Director/General Director, and Controllers
1. Comply with law, the
company’s charter, decisions of the company’s owner with regard to the given
rights and obligations.
2. Perform rights and
obligations in an honest, discreet manner to ensure the best interests of the
company and the company’s owner.
3. Act in the best interest of
the company and the company’s owner; do not use information, secrets, business
opportunities of the company, or abuse the power, or use the company’s assets
for self-seeking purposes or serving the interests of another entity.
4. Provide timely, sufficient,
and accurate information for the company about the enterprises that they or
their related persons own or have the controlling stake or shares. This Notice
shall be put up at the company’s headquarter and branch(es).
5. Other rights and
obligations prescribed by this Law and the company’s charter.
Article
84. Wages, salaries, and other benefits of managers and Controllers
1. Managers and Controllers
shall receive wages, salaries, and other benefits according to the business
outcome of the company.
2. The company’s owner shall
decide the wages, salaries, and other benefits of members of the Board of
members, the company's President, and Controllers. The wages, salaries, and
other benefits of managers and Controllers shall be included in operating
expense as prescribed by regulations of law on taxation, relevant regulations
of law, and recorded as a separate item in the annual financial statement.
3. Wages, salaries, and other
benefits of Controllers may be directly paid by the company’s owner as
prescribed by the company’s charter.
Article
85. Organizational structure of single-member limited liability company under
the ownership of an individual
1. A single-member limited
liability company under the ownership of an individual shall has a the
company's President and a Director/General Director.
2. The company's President may
hire a Director/General Director or concurrently hold such position.
3. Rights and obligations of
the Director/General Director shall be specified in the company’s charter and
employment contract between the Director/General Director and the company's
President.
Article
86. Contracts, transactions between the company and related persons
1. Unless otherwise prescribed
by the company’s charter, the contracts and transactions between a
single-member limited liability company under the ownership of an organization
and the following persons must be considered and decided by the Board of
members or the company's President, the Director/General Director, and
Controllers:
a) The company’s owner and
related persons of the company’s owner;
b) Members of the Board of
members, the Director/General Director, and Controllers;
c) Related persons of the
persons mentioned in Point b of this Clause;
d) Managers of the company’s
owner, persons to designate such managers;
dd) Relevant persons of the
persons mentioned in Point d of this Clause.
The person who concludes the
contract must send a notification to the Board of members or the company's
President, the Director/General Director, and Controllers of the entities
related to such contract/transaction The notification shall be enclosed with
the draft contract or main contents of the transaction.
2. Unless otherwise prescribed
by the company’s charter, the Board of members, the company's President, and
Controllers shall decide whether to accept the contract/transaction within 10
days from the day on which the notification is received under the majority
rule. Each of the said people has a vote. Persons with related interest must
not vote.
3. A contract/transaction
mentioned in Clause 1 of this Article shall only be accepted when all of the
conditions below are satisfied:
a) Parties to the
contract/transaction are independent legal entities with separate interests,
rights, obligations, and assets;
b) Prices in the
contract/transaction are market prices at the time the contract is concluded or
the transaction is made;
c) The company’s owner
fulfills the obligations prescribed in Clause 4 Article 76 of this Law.
4. The contract/transaction
made against the regulations in Clauses 1, 2, and 3 of this Article and causes
damage to the company shall be annulled and dealt with as prescribed by law.
The person who concludes the contract and related persons of the parties
concerned shall be jointly responsible for the damage inflicted and shall pay
compensation for such damage, and return to the company the profits derived
from such contract/transaction.
5. Every contract and
transaction between a single-member limited liability company under the
ownership of an individual with the company’s owner or related person of the
company’s owner must be recorded in writing. Such records shall be kept
separately as company’s documents.
Article
87. Adjustment to charter capital
1. A single-member limited
liability company shall adjusts its charter capital in the following cases:
a) Part of stakes in the
company’s charter capital is returned, provided that the company has continued
its business operation for more than 02 years from the business registration
date, and that all debts and liabilities can be paid after the return;
b) Charter capital is not
provided by the owner fully and punctually as prescribed in Article 74 of this
Law.
2. Charter capital of a
single-member limited liability company shall be increased when the company’s
owner makes additional investment or raise additional capital from other
persons. The owner shall decide the method and level of increase to charter
capital.
3. If charter capital is
increased by raising capital from other persons, the company must be converted
into one of the following types of business entity:
a) a multi-member limited
liability company; the company must register changes to business registration
contents within 10 days from the completion of charter capital adjustment; or
b) a joint-stock company as
prescribed in Article 196 of this Law.
Chapter
IV
STATE-OWNED COMPANIES
Article
88. Regulations applied to state-owned companies
1. State-owned company shall be
organized and administered in accordance with this Chapter, corresponding
regulations in Section 2 Chapter III, and other relevant regulations of this
Law. In case of any discrepancy between Chapter IV and Chapter III and other
regulations of this Law, this Law shall prevail.
2. Regulations of Section 1 of
Chapter III and Chapter V of this Law shall apply to administration of wholly
state-owned companies.
Article
89. Organizational structure
The agency that represents the
state ownership (hereinafter referred to as representative agency) shall decide
whether to operate the state-owned company in the form of a limited liability
company using one of the two models prescribed in Clause 1 Article 78 of this
Law.
Article
90. The Board of members
1. The Board of members, on
behalf of the company, shall exercise the company’s rights and obligations in
accordance with this Law and relevant regulations of law.
2. The Board of members
consists of not more than 07 people, including the Chairperson and other
members. Members of the Board of members are standing members, designated,
dismissed, commended, and disciplined by the representative agency.
3. The term of office of the
Chairperson and other members shall not exceed 05 years. Members of the Board
of members may be re-designated with a term limit of 02 terms.
Article
91. Rights and obligations of the Board of members
1. The Board of members, on
behalf of the company, shall perform the rights and obligations of the owner,
shareholders, members to the companies under the ownership of the company or
the shares/stakes of which are held by the company.
2. The Board of members has
the following rights and obligations:
a) Decide the contents
prescribed in the Law on management and use of state capital for investment in enterprises;
b) Decide the establishment,
restructuring, dissolution of branches, representative office, and financially
dependent units;
c) Decide annual business
plans, market development policies, marketing, and technology of the company;
d) Organize internal audits
and decide establishment of the internal audit unit.
dd) Perform other rights and
obligations prescribed by this Law, relevant regulations of law, and the
company’s charter.
Article
92. Conditions and standards of members of the Board of members
A member of the Board of
members must:
1. has qualifications and
actual experience of the business administration or of the enterprise’s
business lines.
2. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, sibling, brother-in-law,
sister-in-law of the head or deputy head of the representative agency, another
member of the Board of members, the Director/Deputy Director or General
Director/Deputy General Director, the Chief accountant, or a Controller of the
company.
3. Not be an official of a
regulatory body, political organizations, socio-political organizations, or not
be a manager of a subsidiary.
4. Not ever be discharged from
the position of the Chairperson of the Board of members, member of the Board of
members, the company's President, Director/General Director, Deputy
Director/Deputy General Director of a state-owned company.
5. satisfy other standards and
conditions prescribed by the company’s charter.
Article
93. Discharge and dismissal of members of the Board of members
1. The Chairperson and a
member of the Board of members shall be discharged from his/her position if
such person:
a) fails to satisfy the
standards and requirements in Article 92 of this Law;
b) tenders a resignation and
the resignation is accepted in writing by the representative agency;
c) receives a decision on
resignation or retirement;
d) is not capable of the given
tasks or legally
incompetent;
dd) is not healthy enough or
does not have sufficient prestige to hold the position of member of the Board of
members.
2. The Chairperson and a
member of the Board of members shall be dismissed in the following cases:
a) The company fails to
achieve annual targets; fails to maintain and develop capital at the request of
the representative agency without justifiable explanation or the explanation
that is accepted by the representative agency.
b) The person is prosecuted
and is declared guilty by the Court;
c) The person is not honest
during the performance of his/her rights and duties; abuses of power or
position; uses the company’s property for self-seeking purpose or serve the
interests of another entity; provide false information about the company’s
business outcomes.
3. Within 60 days from the day
on which the decision on dismissal or discharge is issued, the representative
agency shall consider appointing another person.
Article
94. Chairperson of the Board of members
1. The Chairperson of the
Board of members shall be designated by the representative agency. The
Chairperson of the Board of members must not concurrently hold the position of
Director/General Director of the company or other enterprises.
2. The Chairperson of the
Board of members has the following rights and obligations:
a) Build up quarterly and
annual operation plans of the Board of members;
b) Prepare agenda, documents
serving the meeting, or absentee voting of the Board of members;
c) Convene and chair meetings
of the Board of members or carry out the absentee voting;
d) Organize the implementation
of Resolutions of the representative agency and the Board of members;
dd) Organize supervision,
directly supervise and assess achievements of strategic targets, the company’s
performance, the Director’s or General Director’s performance;
e) Provide, disclose
information about the company in accordance with law; take responsibility for
the sufficiency, accuracy, truthfulness, and systematicness of the information
disclosed;
g) Perform other rights and
obligations prescribed by this Law, relevant regulations of law, and the
company’s charter.
3. Apart from the cases
mentioned in Article 93 of this Law, the Chairperson of the Board of members
might be dismissed or discharged from duty if failing to perform the duties
mentioned in Clause 2 of this Article.
Article
95. Rights and obligations of other members of the Board of members
1. Attend meetings of the
Board of members, discuss, make proposals, and vote on the issues within the
competence of the Board of members.
2. Inspect, consider, examine,
copy logbooks, monitor transactions, accounting books, annual financial
statement, minutes of meetings of the Board of members, and other documents of
the company.
3. Perform other rights and
obligations prescribed by this Law, relevant regulations of law, and the
company’s charter.
Article
96. Responsibilities of the Chairperson and other members
1. Comply with law, the
company’s charter, and decisions of the company’s owner.
2. Perform the given rights
and obligations in an honest, careful manner to serve the best legitimate
interests of the company and the State.
3. Act in the best interest of
the company and the State; do not use the company’s business opportunities,
information, secrets; do not abuse power or position; not use the company’s
property for self-seeking purpose or serve the interests of another entity;
4. Provide the company with
timely, sufficient, and accurate information about the enterprises they and
their related person own or have shares or stakes; Such information shall be
posted at the company’s headquarter and branches.
5. Comply with Resolutions of
the Board of members.
6. Take personal
responsibilities for taking advantage of the company’s name to commit
violations of law; do business or make transactions that does not serve the
company’s interest and cause damage to other people; pay undue debts when the
company is facing financial risks.
7. Any member of the Board of
members that discovers another member’s violations against his/her obligations
shall send a written report to the representative agency, request a termination
of the violations and remedial measures.
Article
97. Working conditions, requirements and methods for convening meetings of the
Board of members
1. The Board of members shall
work as a group; at least a meeting shall be held in a quarter to consider
deciding the issues within its competence. With regard to the issues that do
not need discussing, the Board of members may carry out absentee voting
according to the company’s charter.
The Board of members may
convene extraordinary meetings to resolve urgent issues at the request of the
organization that represents the company’s owner or at the request of the
Chairperson of the Board of members or when it is requested by more than 50% of
members of the Board of members, by the Director/General Director.
2. The Chairperson of the
Board of members or a member authorized by the Chairperson of the Board of
members shall prepare the agenda, documents, convene and chair meetings of the
Board of members. Members of the Board of members are entitled to propose
meeting contents in writing. Contents and documents of the meeting shall be
sent to members of the Board of members and invited participants (if any) at
least 03 days before the meeting date. Documents related to proposed amendments
to the company’s charter, the company’s development orientation, restructuring
or dissolution of the company must be sent to the members at least 05 days
before the meeting date.
3. The invitations may be made
in writing, by phone, fax, or another electronic medium, and sent directly to
each member of the Board of members and invited participants. The invitation
must specify the time, location, and contents of the meeting. Online meetings
may be held where necessary.
4. A meeting of members of the
Board of members is considered valid when it is attended by at least 2/3 of
members of the Board of members. A Resolution of the Board of members is
ratified when it is voted for by more than half of the participating members;
in the event of equal votes, the Chairperson of the Board of members or a
person authorized to chair the meeting by the Chairperson of the Board of
members shall have the casting vote. Members of the Board of members may
reserve their opinions and submit a proposal to the representative agency.
5. In case of absentee voting of members
of the Board of members, the Resolution of the Board of members shall be
ratified when it is approved by a majority of the members.
A Resolution may be approved
by using multiple copies of the same copy if each copy bears at least a
signature of a member of the Board of members.
6. According to the contents
and agenda of the meeting, where necessary, the Board of members is entitled or
required to invite competent representatives from relevant
agencies/organizations to attend the meeting and discuss the issues. Invited
representatives of agencies/organizations may offer their opinions and may not
vote. All opinions of invited representatives shall be written in the meeting
minutes.
7. Contents of the issues
discussed, opinions, voting result, decisions ratified by the Board of members,
and conclusions of meetings of the Board of members shall be recorded in
writing. The Chair and secretary of the meeting are jointly responsible for the
accuracy and truthfulness of the meeting minutes. The minutes of the meeting must
be completed and ratified before the end of the meeting. The meeting minutes
must have the following content:
a) Time, location, purposes,
agenda of the meeting; list of attending members; issues to be discussed and
voted; summary of opinions of each member about each issue;
b) The numbers of affirmative
votes and negative votes and abstentions (if applied)
c) The decisions ratified,
full names and signatures of attending members.
8. Members of the Board of
members are entitled to request the Director/General Director or Deputy
Director/Deputy General Director, Chief accountant, and the managers of the
company and subsidiaries of which 100% charter capital is held by the company,
representatives of the company’s stakes in other enterprises to provide info,
documents about their financial status and performance in accordance with the
regulations on information provision promulgated by the Board of members or in
accordance with the Resolution of the Board of members. The persons requested
to provide information shall provide timely, sufficient, accurate information
and documents at the request of members of the Board of members, unless
otherwise decided by the Board of members.
9. The Board of members shall
use the executive apparatus, assisting units (if any), and the company’s seal
to perform their duties.
10. Operating cost of the
Board of members, salaries, benefits, and other remunerations shall be included
in the company’s administrative expense.
11. Where necessary, the Board
of members shall seek opinions from Vietnamese and foreign consultants before
deciding an importing issue within the competence of the Board of members. The
consultancy cost shall be specified in financial management regulations of the
company.
12. The Resolution of the
Board of members shall be effective from the day on which it is ratified or
from its effective date written therein, except for the cases in which it must
be accepted by the representative agency.
Article
98. The company's President
1. The company's President
shall be designated by the representative agency as prescribed by law. The term
of office of the company's President shall not exceed 05 years with a term
limit of two terms. Standards, conditions of the company's President, and cases
in which the company's President is dismissed, discharged from duty shall
comply with Article 92 and Article 93 of this Law.
2. The company's President
shall exercise rights and obligations of the owner’s representative in
accordance with the Law on management and use of state capital for investment
in enterprises; other rights and obligations prescribed in Article 91 and
Article 96 of this Law.
3. Salary, bonuses, and other
benefits of the company's President shall be decided by the representative
agency and included in the company’s administrative expense.
4. The company's President
shall use the executive apparatus, assisting units (if any), and the company’s
seal to perform his/her duties. Where necessary, the company's President shall
consult with Vietnamese and foreign experts before deciding an importing issue
within the competence of the company's President. The consultancy cost shall be
specified in financial management regulations of the company.
5. The decisions mentioned in
Clause 2 of this Article must be made in writing and bear the signature of the
company's President, even if the company's President concurrently holds the
position of Director/General Director.
6. A Decision of the company's
President shall be effective from the day on which it is signed or from its
effective date written therein, except for the cases in which it must be
accepted by the representative agency.
7. Where the company's
President is not present in Vietnam for more than 30 days, another person must
be authorized in writing to perform some of the rights and obligations of the
company's President’s; the authorization must be made in writing and a written
notification shall be promptly sent to the representative agency. Other cases
of authorization shall comply with the company’s rules and regulations.
Article
99. Director/General Director
1. The Director/General
Director shall be designated by the Board of members or the company's
President, or hired according to a personnel plan approved by the
representative agency. A company shall have one or some Deputy General
Director/Deputy General Director. The quantity of Deputy Director/Deputy
General Director, the power to designate Deputy General Director/Deputy General
Director shall be specified in the company’s charter. Rights and obligations of
the Deputy Director/Deputy General Director shall be specified in the company’s
charter or employment contract.
2. The Director/General
Director shall run the company’s everyday operation and has the following
rights and obligations:
a) Organize the implementation
of the company’s business plans and investment plans and assess the results
thereof;
b) Organize the implementation
of Resolutions of the Board of members, the company's President, and the
representative agency; assess the result thereof;
c) Decide the company’s
everyday tasks;
d) Promulgate the company’s
rules and regulations, which have been approved by the Board of members or the
company's President;
dd) Sign contracts, agreements
on behalf of the company, except for those within the competence of the
Chairperson of the Board of members or the company's President;
e) Designate, hire, dismiss,
discharge from duty, terminate employment contracts with the company’s
managers, except for those under the management of the Board of members or the
company's President;
g) Hire employees;
h) Make and submit quarterly,
annual reports on achievement of business targets, annual financial statement
to the Board of members or the company's President;
i) Propose restructuring plan
where necessary;
k) Propose distribution and
use of post-profit and other financial obligations of the company;
l) Perform other rights and
obligations prescribed by law and the company’s charter.
Article
100. Standards and conditions of Director/General Director
The Director/Deputy Director must:
1. Has qualifications and
actual experience of the business administration or of the company’s business
lines.
2. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister of the
manager of head or deputy head of the representative agency.
3. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister of the
manager of any member of the Board of members.
4. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister of the
Deputy Director/Deputy General Director or Chief accountant of the company.
5. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister,
brother-in-law, sister-in-law of the company’s Controller.
6. Not concurrently hold the
position of official in a regulatory agency, political organization, or
socio-political organization.
7. Not ever be discharged from
the position of the Chairperson of the Board of members, member of the Board of
members, the company's President, Director/General Director, Deputy
Director/Deputy General Director of another state-owned company.
8. Not concurrently hold the
position of Director/General Director of another enterprise.
9. Satisfy other standards and
conditions prescribed by the company’s charter.
Article
101. Dismissal, discharge from duty of Director/General Director and other
managers
1. The Director/General
Director shall be dismissed when he/she:
a) fails to satisfy the
standards and requirements in Article 100 of this Law;
b) tenders a resignation.
2. The Director/General
Director shall be discharged from duty in the following cases:
a) The enterprise fails to
preserve the capital as prescribed by law;
b) The enterprise fails to
achieve annual business targets;
c) The qualifications and
competency of the Director/General Director do not meet the requirements for
the new business plan and development strategy of the enterprise.
d) The enterprise commits
violations of law or its business operation is against the law;
dd) Any of the manager’s
duties is violated according to Article 96 of this law;
e) Other cases prescribed by
the company’s charter.
3. The cases in which the Deputy
Director/Deputy General Director, Chief accountant, and other managers are
dismissed and discharged from duty shall be specified by the company’s charter.
Article
102. Control Board
1. Depending on the scale of
the company, the representative agency shall appoint 01 Controller or establish
a the Control Board that consist of 03 – 05 Controllers. A controller of a
company has a term of office of up to 05 years with a term limit of 02 terms.
2. The Control Board has the
following rights and obligations:
a) Supervise the
implementation of development plans, business plans, achievement of strategic
targets and planned targets of the company;
b) Supervise, assess the
performance of rights and obligations of members of the Board of members, the
Board of members, Director/General Director of the company;
c) Supervise, assess the
effect and conformity with regulations on internal audit, risk management and
reduction, reporting, and other administrative regulations of the company;
d) Supervise the legitimacy,
systematicness, and truthfulness of accounting works, accounting books,
financial statements, appendices and relevant documents;
dd) Supervise transactions
between the company and related parties;
e) Supervise implementation of
major projects of investment, major or unusual purchases, sales, and other
transactions of the company;
g) Make and send report on assessment,
proposals mentioned in Points a, b, c, d, dd, and e of this Clause to the
representative agency and the Board of members;
h) Perform other rights and
obligations at the request of the representative agency or according to the
company’s charter.
3. Salaries, bonuses of
Controllers shall be decided and paid by the representative agency.
4. Government shall elaborate
this Article.
Article
103. Conditions and standards of Controllers
A Controller must:
1. Be professionally trained
in finance, accounting, audit, law, business administration, and has at least
03 years’ experience; the Chief Controller must have qualifications and have at
least 05 years’ experience of finance, accounting, audit, law, business
administration
2. Not be a company’s employee.
3. Not be a spouse, birth
parent, adoptive parent, birth child, adopted child, brother, sister,
brother-in-law, sister-in-law of the following entities.
a) The head and deputy head of
the representative agency;
b) Members of the Board of
members of the company;
c) Deputy Director/Deputy
General Director and Chief accountant of the company;
d) Other Controllers of the
company.
4. Not concurrently hold the
position of Director/General Director of another enterprise.
5. Not concurrently hold the
position of Controller, member of the Board of members, member of the Board of
Directors of a enterprise other than state-owned enterprises.
6. Satisfy other standards and
conditions prescribed by the company’s charter.
Article
104. Rights of the Control Board and Controllers
1. Attend meetings of the
Board of members, consultancies, official and unofficial discussions between
the representative agency and the Board of members; enquire the Board of
members, members of the Board of members, and Director/General Director about
the plans, projects, development investment programs, and other decisions
related to the company’s administration.
2. Examine accounting books,
reports, contracts, transactions, and other documents of the company; inspect
the administration of the Board of members, members of the Board of members,
Director/General Director where necessary or at the request of the
representative agency.
3. Examine, assess the
business performance and financial status of the company, the effect of
internal administration regulations of the company.
4. Request members of the
Board of members, the Director/General Director or Deputy Director/Deputy
General Director, Chief accountant, and other managers to report and provide
information within the scope of management and investment, business operation
of the company.
5. Request the company’s
managers to report the financial status, business performance of subsidiaries
where necessary for fulfillments of duties as prescribed by law and the
company’s charter.
6. Report members of the Board
of Members, Director/General Director, or other managers who act against their
rights and obligations or are likely to do so; report violations against the
law, regulations on economic management, the company’s charter, internal
administration regulations to the representative agency, other members of the
Control Board, and relevant individuals.
7. Request the representative
agency to establish a unit specialized in consulting audit and assisting the
Control Board in performance of their given rights and obligations.
8. Exercise other rights
prescribed by the company’s charter.
Article
105. Working mode of the Control Board and Controllers
1. The Chief of the Control
Board is the standing officer of the company; other members may participate in
Control Boards of up to 04 state-owned companies, provided such participation
is approved in writing by the representative agency.
2. Chief of the Control Board
shall formulate monthly, quarterly, and annual working plan of the Control
Board; assign tasks to each member.
3. Controllers shall
independently and proactively perform the given tasks; propose off-plan tasks
where necessary.
4. The Control Board shall
hold at least one meeting a month to review and ratify reports on controlling
result of the month, then submit them to the representative agency; discuss and
ratify the next working plans of the Control Board.
5. A decision of the Control
Board shall be ratified when it is approved by a majority of the attending
member. Every opinion in contravention of the ratified decision must be
accurately recorded and report to the representative agency.
Article
106. Responsibilities of Controllers
1. Comply with law, the
company’s charter, decisions of the representative agency, and professional
while performing the rights and obligations prescribed in this Law and the
company’s charter.
2. Perform the given rights
and obligations in an honest, careful manner to serve the best legitimate
interests of the State and related parties.
3. Act in the best interest of
the company and the State; do not use the company’s business opportunities,
information, secrets; do not abuse power or position; do not use the company’s
property for self-seeking purpose or serve the interests of another entity;
4. Fulfill other obligations
prescribed in this Law and the company’s charter.
5. Any Controller that
violates against the obligations prescribed in Clause 1, 2, 3, or 4 of this
Article and causes damage to the company shall take personal responsibility or
pay compensation for such damage; such Controller may also face disciplinary
actions, administrative penalties, or criminal prosecution depending on the
nature and severity of the violations.
6. All incomes and benefits
derived from the violations against obligations prescribed in Clause 1, 2, 3,
or 4 of this Article shall be returned to the company.
7. Any member of the Control Board that
discovers another member’s violations against his/her obligations shall send a
written report to the representative agency, request a termination of the
violations and remedial measures.
Article
107. Dismissal and discharge from duty of Controllers
1. A controller shall be
dismissed when he/she:
a) no longer meets the
standards and requirements in Article 103 of this Law;
b) tenders a resignation and
the resignation is accepted by the representative agency;
c) is requested by the
representative agency or another competent authorities to undertake other
tasks;
d) Other cases prescribed by the company’s
charter.
2. A controller shall be
discharged from duty when he/she:
a) fails to fulfilled the
given tasks and duties;
b) fails to perform his/her
rights and obligations for 03 consecutive months, except for force majeure
events;
c) commits serious violations
or repeat violations against Controllers’ duties prescribed in this Law and the
company’s charter;
d) Other cases prescribed by
the company’s charter.
Article
108. Periodic information provision
1. The company must
periodically provide the following information on its website and on the
website of the representative agency:
a) Basic information about the
company and the company’s charter;
b) Overall targets, specific
targets of the annual business plan;
c) Report and summary of the
annual financial statement which has been audited by a independent audit
organization within 150 days from the end of the fiscal year;
d) Report and summary of the
mid-year financial statement which has been audited by a independent audit
organization; this information must be provided before July 31 every year;
The information to be provided
mentioned in Point c and Point d of this Clause includes financial statements
of the parent company and the consolidated financial statement;
dd) Report on implementation
of the annual business plans and those of the latest 03 years before the
reported year;
e) Reports on fulfillment of
public duties given according to plan or bidding (if any) and other social
duties;
g) Report on the company’s
administration and organizational structure.
2. The report on the company’s
administration shall contain the information below:
a) Information about the
representative agency, the head and deputy head of the representative agency;
b) Information about the
company’s manager, including his/her qualifications, professional experience,
managerial positions they held, method of designation, current positions, their
salaries, bonuses, method of payment of salaries and other benefits; their
related persons and related interests to the company; the manager’s annual
self-assessment;
c) Relevant decisions of the
representative agency; decisions, Resolutions of the Board of members or the
company's President;
d) Information about the
Control Board, Controllers, and their activities;
dd) Information about Employee
Congresses, average quantity of employees every year and on the reporting date;
annual average salary and other benefits of an employee;
e) Report on conclusion of
inspecting body (if any) and reports of the Control Board, Controllers;
g) Information about related
parties of the company, transactions between the company and related parties;
h) Other information
prescribed by the company’s charter.
3. Information reported and
disclosed must be sufficient, accurate, and timely as prescribed by law.
4. The legal representative or
an authorized person shall disclose information. The legal representative is
responsible for the sufficiency, accuracy, truthfulness, and systematicness of
the information disclosed.
5. Government shall elaborate
this Article.
Article
109. Extraordinary information disclosure
1. Extraordinary information
must be disclosed on the company’s website, publications, and posted at the
company’s headquarter and business locations within 36 hours from the
occurrence of any of the events below:
a) The company’s bank account
is frozen or unfrozen;
b) Part of or all of the
business operation is suspended; the Certificate of Business registration,
license for establishment, license for establishment and operation, or any
license related to the company’s business is revoked;
c) The Certificate of Business
registration, license for establishment, license for establishment and
operation, or any license/certificate related to the company’s operation is
adjusted;
d) Replacement of managers,
including members of the Board of members, the company's President,
Director/General Director or Deputy Director/Deputy General Director, Chief
Controller, Controllers, Chief accountant, Head of Finance and Accounting
Department;
dd) There is a decision on
disciplinary action, prosecution, a court’s sentence of decision against one of
the enterprise’s manager;
e) The inspecting body or tax
authority concludes that the enterprise commits violations of law;
g) There is a decision to
change the independent audit organization or the financial audit is refused;
h) There is a decision on
establishment, dissolution, amalgamation, merger, conversion of subsidiaries;
decision on investment, capital decrease, or withdrawal capital in other
companies.
2. Government shall elaborate
this Article.
Chapter
V
JOINT-STOCK COMPANIES
Article
110. JOINT-STOCK COMPANIES
1. A joint-stock company is a
enterprise of which:
a) Charter capital is split
into multiple units of equal value called shares;
b) Shareholders may be
organizations and individuals; the minimum quantity of shareholders is 03; the
maximum quantity is not restricted.
c) Shareholders are only
liable for the enterprise’s debts and other liabilities up to the value of
capital contributed to the enterprise;
d) Shareholders are entitled
to transfer their shares to other persons, except for the cases in Clause 3
Article 119 and Clause 1 Article 126 of this Law.
2. A joint-stock company has
its legal status from the issuance date of the Certificate of Business
registration.
3. Joint-stock companies are
entitled to issue various types of shares to raise capital.
Article
111. Capital of joint-stock companies
1. Charter capital of a
joint-stock company is to total face value of sold shares. Charter capital of a
joint-stock company on the business registration date is total face value of
registered shares of various types. Charter capital is specified in the
company’s charter.
2. Sold shares are the amount
of authorized shares that have been paid-off by shareholders to the company. On
the enterprise registration date, sold shares are the total amount of
registered shares.
3. Authorized shares are the
total amount of shares of various types that the General Meeting of
Shareholders decides to offer to raise capital. The amount of authorized shares
on the business registration date is the total amount of shares of various
types that will be sold by the company to raise capital, including registered
shares and unregistered shares.
4. Unsold shares are
authorized shares that have not been paid-off. On the enterprise registration
date, unsold shares are the total amount of shares that are not registered by
shareholders.
5. The company may changes its
charter capital in the following cases:
a) According to a decision of
the General Meeting of Shareholders, the company returns part of the stakes to
shareholders in proportion to their holding, provided that the company has
continued its business operation for more than 02 years from the business
registration date, and that all debts and liabilities can be paid after the
return;
b) The company repurchases
issued shares as prescribed in Article 129 and Article 130 of this Law;
c) Charter capital is not
contributed fully and punctually by members as prescribed in Article 112 of
this Law.
Article
112. Payment for shares registered upon business registration
1. Shareholders shall fully
pay for the registered shares within 90 days from the issuance date of the
Certificate of Business registration, unless a shorter time limit is prescribed
by the company’s charter or the share registration contract. The Board of
Directors shall supervise and urge shareholders to pay for the registered
shares fully and punctually.
2. Within the period from the
issuance date of the Certificate of Business registration to the deadline for
fully paying for registered shares prescribed in Clause 1 of this Article, the
number of votes shall be the number of ordinary registered shares, unless
otherwise prescribed by the company’s charter.
3. If a shareholder fails to
pay or fails to pay completely for the ordered shares, the following
regulations shall apply:
a) The shareholders that fails
to pay for the registered shares is obviously no longer a shareholder of the
company and must not transfer the call option to another person;
b) The shareholder that pays
for part of the registered shares shall have the right to vote, receive
dividends, and other rights corresponding to the paid shares; must not transfer
the call option of the unpaid shares to another person;
c) The unpaid shares shall be
considered unsold shares, which may be offered by the Board of Directors;
d) The company shall register
an adjustment to charter capital to the total face value of shares paid fully
and change of founding shareholders within 30 days from the deadline for paying
for registered shares mentioned in Clause 1 of this Article.
4. The shareholder that fails
to pay or fails to pay completely for the registered shares shall have
responsibility for financial obligations of the company which are incurred
during the period mentioned in Clause 1 of this Article. Nevertheless, the
responsibility shall be proportional to the total face value of such registered
shares. Members of the Board of Directors, the legal representative shall take
joint responsibility for damage caused by the failure to adhere to Clause 1 and
Point d Clause 3 of this Article.
Article
113. Types of shares
1. A joint-stock company must
have ordinary shares. Holders of ordinary shares are ordinary shareholders.
2. Apart from ordinary shares,
a joint-stock company may have preferred shares. Holders of preferred shares
are called preferred shareholders. Preferred shares include:
a) Voting preference shares;
b) Shares with preferred
dividends;
c) Redeemable preferred
shares;
d) Other preferred shares
defined by the company’s charter.
3. Only organizations
authorized by the government and founding shareholders may hold voting
preference shares. The voting preference of founding shareholders is only
effective for 03 years from the issuance date of the Certificate of Business
registration. After this period, voting preference shares of founding
shareholders shall be converted into ordinary shares.
4. The persons entitled to buy
shares with preferred dividends, redeemable preferred shares, and other
preferred shares shall be prescribed by the company’s charter or the General
Meeting of Shareholders.
5. Each share of the same
types provides its holder with equal rights, obligations, and interests.
6. Ordinary shares cannot be
converted into preferred shares. Preferred shares may be converted into
ordinary shares under the Resolution of the General Meeting of Shareholders.
Article
114. Rights of ordinary shareholders
1. Every ordinary shareholder
is entitled to:
a) Attend and give opinions at
the General Meetings of Shareholders; exercise the right to vote directly or
via an authorized representative or in another form permitted by law or the
company’s charter. Each ordinary share has a vote;
b) Receive dividends at a rate
decided by the General Meeting of Shareholders;
c) Has the preemptive right
when buying newly-offered shares in proportion to his/her ordinary shares;
d) Transfer his/her shares to
other persons, except for the cases in Clause 3 Article 119 and Clause 1
Article 126 of this Law;
dd) Examine and collect
information from the List of shareholders having voting right; request
adjustments to incorrect information;
e) Examine, copy the company’s
charter, minutes of General Meeting of Shareholders, and Resolutions of the
General Meeting of Shareholders;
g) Receive a proportion of
remaining asset which is proportional to his/her holdings when the company is
dissolved or bankrupt.
2. Any shareholder or group of
shareholders that holds at least 10% of ordinary shares for at least 06
consecutive months (or a smaller amount prescribed by the company’s charter)
shall have the right to:
a) Nominate candidates for the
Board of Directors and the Control Board;
b) Examine, copy minutes of
meetings and Resolutions of the Board of Directors, mid-year and annual
financial statement using the forms of Vietnam’s Accounting System, and reports
of the Control Board;
c) Request convention of the
General Meeting of Shareholders in the cases mentioned in Clause 3 of this
Article;
d) Request the Control Board
to inspect each issue related to the company’s administration where necessary.
The request shall be made in writing, bear the full name, address, Nationality,
ID/passport number if the shareholder is an individual; name, permanent
residence, nationality, establishment decision number or business registration
number if the shareholder is an organization; the holding and time of shares
registration of each shareholder; total shares of the group of shareholders and
the proportion of shares to the company’s total shares; the issues that need
inspecting, and inspection purposes;
dd) Exercise other rights
prescribed in this Law and the company’s charter.
3. The shareholder or group of
shareholders mentioned in Clause 2 of this Article is entitled to request the
convention of the General Meeting of Shareholders in the following cases:
a) The Board of Directors
commits serious violations against the rights of share holders, obligations of
managers, or make decisions ultra vires;
b) The term of office of the
current the Board of Directors has exceeded 06 months and a new the Board of Directors
is not elected;
c) Other cases prescribed by
the company’s charter.
The request for convention of
the General Meeting of Shareholders shall be made in writing, bear the full
name, address, Nationality, ID/passport number if the shareholder is an individual,
name, enterprise identification number or establishment decision number, and
headquarter address if the shareholder is an organization; the holding and time
of shares registration of each shareholder; total shares of the whole group of
shareholders and the proportion of shares to the company’s total shares; the
basis and reason for requesting the convention of the General Meeting of
Shareholders. The request must be enclosed with documents and evidence of
violations committed by the Board of Directors, seriousness of the violations,
or the decisions made ultra vires.
4. Unless otherwise prescribed
by the company’s charter, nomination of candidates for the Board of Directors
and the Control Board as prescribed in Point a Clause 2 of this Article shall
be carried out as follows:
a) Ordinary shareholders shall
form a group to nominate candidates to the Board of Directors and the Control
Board shall notify the meetings of groups of attending shareholders before the
opening of the General Meeting of Shareholders;
b) According to the number of
Members of the Board of Directors and the Control Board, the shareholder or
group of shareholders mentioned in Clause 2 of this Article shall nominate one
or some candidates for the Board of Directors and the Control Board under a
decision of the General Meeting of Shareholders. In case the number of
candidates nominated is smaller than the maximum number of candidates they may
nominate according to a decision of the General Meeting of Shareholders, other
candidates shall be nominated by the Board of Directors, the Control Board, and
other shareholders.
5. Exercise other rights
prescribed in this Law and the company’s charter.
Article
115. Rights of ordinary shareholders
1. Pay for the ordered shares
fully and punctually.
Do not withdraw capital
contributed by ordinary shares in any shape or form, unless such shares are
repurchased by the company or other persons. In case a shareholder withdraws
part of or all of the share capital contributed against this Clause, such
shareholder and people with related interests in the company are jointly
responsible for the debts and other liabilities of the company up to the
value of withdrawn shares and the damage caused.
2. Comply with the company’s
charter, rules and regulations.
3. Comply with Resolutions of
the General Meeting of Shareholders and the Board of Directors.
4. Fulfill other obligations
prescribed in this Law and the company’s charter.
Article
116. Voting preference shares and rights of holders thereof
1. Voting preference shares
are the shares with more votes than ordinary shares; the number of votes of a
voting preference share shall be prescribed by the company’s charter.
2. Holders of voting
preference shares has the rights to:
a) Vote on the issues within
the competence of the General Meeting of Shareholders with the number of votes
prescribed in Clause 1 of this Article;
b) Exercise other rights of
ordinary shareholders, except for the case in Clause 3 of this Article.
3. Holders of voting
preference shares must not transfer such shares to other persons.
Article
117. Shares with preferred dividends and rights of holders thereof
1. Shares with preferred
dividends are shares that pay higher dividends than dividends of ordinary
shares, or that pay a fixed amount of annual dividends. Annual distributed
dividends include fixed dividend and bonus dividends; fixed dividend does not
depend on the company’s business outcome. The level of fixed dividend and
method for determination of bonus dividends shall be written on the certificates
of shares with preferred dividends.
2. Holders of shares with
preferred dividends has the rights to:
a) Receive dividends as
prescribed in Clause 1 of this Article;
b) Receive a proportion of
remaining assets corresponding to their holding upon the company’s dissolution
or bankruptcy after the company has paid all debts and redeemable preferred
shares;
c) Exercise other rights of
ordinary shareholders, except for the case in Clause 3 of this Article.
3. Holders of shares with
preferred dividends do not have the voting right, attend the General Meeting of
Shareholders, nominate candidates for the Board of Directors and the Control
Board.
Article
118. Redeemable preferred shares and rights of holders thereof
1. Redeemable preferred shares
are shares that will be redeemed by the company at the request of their holders
or under the conditions written thereon.
2. Holders of redeemable
preferred shares have the same rights as ordinary shareholders, except for the
case in Clause 3 of this Article.
3. Holders of redeemable
preferred shares do not have the voting right, attend the General Meeting of
Shareholders, nominate candidates for the Board of Directors and the Control
Board.
Article
119. Ordinary shares of founding shareholders
1. A new joint-stock company
must have at least 03 founding shareholders; a joint-stock company converted
from a state-owned company or limited liability company, or derived from a
division, split, amalgamation, merger of another joint-stock company is not
required to have founding shareholders.
If there are no founding
shareholders, the company’s charter enclosed with the application for
enterprise registration must bear the signature of the legal representative or
ordinary shareholders of such company.
2. Founding shareholders must
register at least 20% of total authorized ordinary shares on upon business
registration.
3. Within 03 years from the
issuance date of the Certificate of Business registration, founding
shareholders may transfer their shares to other founding shareholders; they may
transfer their ordinary shares to people other than founding shareholders if
approved by the General Meeting of Shareholders. In this case, the transferring
shareholders do not have the right to vote on the transfer of such shares.
4. Restrictions to ordinary
shares of founding shareholders shall be lifted after 03 years from the
issuance date of the Certificate of Business registration. These restrictions
shall not apply to the shares that founding shareholders obtain after business
registration and the shares transferred by founding shareholders to people
other than founding shareholders of the company.
Article
120. Share certificates
1. Share certificates are
certificates issued by a joint-stock company, book entries, or electronic data
which certify ownership of one or an amount of shares of the company. A share
certificate must contain the following information:
a) Name, ID number,
headquarter address of the enterprise;
b) Amount and type of shares;
c) Face value of each share
and total face value of shares written on the share certificate;
d) Full name, address,
Nationality, ID/passport number if the shareholder is an individual; name,
enterprise identification number or establishment decision number, and
headquarter address if the shareholder is an organization;
dd) Summary of procedures for
Share transfer;
e) Signature of the legal
representative and the company’s seal (if any);
g) Registration number in the
shareholder register and share issuance date;
h) Preferred share
certificates shall contain other information prescribed in Articles 116, 117
and 118 of this Law.
2. If there is a mistake in the contents and
format of the share certificates issued by the company, the rights and
interests of their holders shall not be affected. The legal representative of the
company shall take responsibility for the damage caused by such mistakes.
3. In case a share certificate
is lost, damaged, or otherwise destroyed, the shareholder shall be reissued
with another share certificate at the shareholder's request.
The request must contain the
following information:
a) The share certificate that
is lost, damaged, or otherwise destroyed. In case the share certificate is
lost, the shareholder must make a commitment that a thorough search for it has
been carried out and it will be returned to the company for destruction purpose
if it is ever found.
b) Assumption of
responsibility for disputes over issuance of the new share certificate.
With regard to any share the
total face value of which is over VND 10 million, before receiving the request
for issuance of a new share certificate, company’s legal representative may
request the holder to post a notification of the share certificate that is
lost, damaged, or otherwise destroyed, then request the company to issue a new
share certificate after 15 days from the day on which the notification is
posted.
Article
121. Shareholder register
1. Every joint-stock company
shall make and keep the shareholder register from the issuance date of the
Certificate of Business registration. The shareholder register may be paper
documents, electronic data, or both.
2. The shareholder register
must contain the following information:
a) Name, headquarter address
of the company;
b) Total number of authorized
shares, types of authorized shares, and number of each type of authorized
shares;
c) Total sold shares of each
type and value of contributed share capital;
d) Full name, permanent
residence, Nationality, ID/passport number if the shareholder is an individual;
name, enterprise identification number or establishment decision number, and
the headquarter address if the shareholder is an organization;
dd) Amount of each type of
shares held by each shareholder; date of shares registration.
3. Shareholder register shall
be kept at the company’s headquarter or Vietnam Securities Depository;
shareholders are entitled to inspect, examine, or copy contents of the
shareholder register during working hours of the company or Vietnam Securities
Depository.
4. Any shareholder that
changes his/her permanent residence must promptly notify the company to update
the shareholder register. The company is not responsible if the shareholder
cannot be contacted because of failure to notify the change of his/her address.
Article
122. Share offering
1. Share offering means the
company’s increase of the amount of authorized shares and selling such shares
during the company’s operation to increase charter capital.
2. Share offering may be
carried out in the following forms:
a) Offering of shares to
existing shareholders;
b) Public offering of shares;
c) Private placement of
shares.
3. Regulations of law on
securities shall apply to public offering of shares, offering of shares of
listed companies and public companies.
4. The company shall register
change to charter capital within 10 days from completion of the share offering.
Article
123. Private placement of shares
The private placement shares
of a joint-stock company other than a public joint-stock company shall be
carried out as follows:
1. Within 05 days from the date
of issuance of the decision on private placement, the company shall send a
notification of the private placement to the business registration authority.
The notification shall be enclosed with the following documents:
a) The Resolution of the
General Meeting of Shareholders on private placement;
b) The private placement plan
ratified by the General Meeting of Shareholders (if any);
2. The notification of private
placement shall contain the following information:
a) Name, ID number,
headquarter address of the enterprise;
b) Intended total amount of
shares to be offered; types of shares to be offered, and amount of each type;
c) Time and method of offering;
d) Full name and signature of
the company’s legal representative;
3. The company may offer
shares if no objection is made by the business registration authority after 05
working days from the day on which the notification is sent.
4. The company shall register
change to charter capital to the business registration authority within 10 days
from completion of the share offering.
Article
124. Offering of shares to existing shareholders
1. Offering of shares to
existing shareholders means the company’s increase of the amount of authorized
shares and selling all of such shares to all shareholders according to their
shares of the company.
2. The offering of shares to
existing shareholders of a joint-stock company other than a public joint-stock
company shall be carried out as follows:
a) The company shall send
written notifications to shareholders’ permanent residences or mailing
addresses by registered mails according to the shareholder register at least 15
days before the deadline for registering to buy shares;
b) The notification shall
contain the full name, address, Nationality, ID/passport number if the shareholder
is an individual, name, enterprise identification number or establishment
decision number, headquarter address if the shareholder is an organization; the
shares and holding in the company; total amount of shares to be offered, amount
of shares may be purchased by shareholders; offer prices; deadline for
registration; full name and signature of the company’s legal representative.
The notification of be enclosed with the registration form issued by the
company. If the registration form is not sent to the company by the notified
deadline, the shareholder shall no longer have the preemptive right to buy
shares;
c) Shareholders are entitled
to transfer their preemptive right to buy shares to other people.
3. In case the amount of
offered shares are not completely registered by shareholders and recipients the
preemptive right to buy shares, the Board of Directors is entitled to sell the
remaining authorized shares to shareholders of the company or other people in a
reasonable manner and conditions that are not more convenient than the
conditions offered to shareholders, unless otherwise accepted by the General
Meeting of Shareholders or shares are sold via a Stock Exchange.
4. Shares are considered sold
when they are fully paid and information about the buyer mentioned in Clause 2
Article 121 of this Law are fully written in the shareholder register; from
then on, the share buyer shall be come a shareholder of the company.
5. After shares are fully
paid, the company shall issue and give share certificates to the buyer. The
company may sell shares without giving share certificates. In this
case, information about the shareholder mentioned in Clause 2 Article 121 of
this Law shall be Recipients written in the shareholder register to certify the
shareholder’s ownership of shares of the company.
Article
125. Selling shares
The Board of Directors shall
decide the time, method of sale, and selling prices of shares. Selling prices
of shares must not fall below the market price on the offering date or the
latest book value of shares, except for the following cases:
1. Shares are initially
offered to those other than founding shareholders;
2. Shares are offered to all
shareholders according to their holding in the company;
3. Shares are offered to a
broker or a guarantor. In such cases, the discount rate or discounting ratio
must be approved by the General Meeting of Shareholders, unless otherwise
prescribed by the company’s charter;
4. Other cases and
corresponding discount rates prescribed by the company’s charter.
Article
126. Share transfer
1. Shares may be freely
transfers, except in the cases mentioned in Clause 3 Article 119 of this Law
and the cases in which shares is restricted from transfer prescribed by the
company’s charter. Where the company’s charter contains regulations on
restriction on share transfer, these regulations are only effective when they
are written on the corresponding shares.
2. The transfer shall be made
into a common contract or via a transaction on the securities market. Where the
transfer is made into a contract, transfer documents must bear the signatures
of the transferor and the transferee (or their representatives). Where transfer
is made via a transaction on the securities market, the procedures and
recording of ownership shall comply with regulations of law on securities.
3. If a shareholder being an
individual dies, his/her inheritor according to the will or according to law
shall become a shareholder of the company.
4. If the dead shareholder
does not have an inheritor, or the inheritor renounces the inheritance, or the
inheritor has the right to inherit deprived, such shares be settled in
accordance with regulations of law on civil affairs.
5. Every shareholder is
entitled to give part of or all of their shares in the company to other people
or use their shares to pay debts. In such cases, the recipients of shares shall
become shareholders of the company.
6. Where a shareholder
transfers a number of shares, the hold shares shall be annulled, and the
company shall issue new shares to record the amount of shares transferred and
the remaining amount of shares.
7. Recipients of shares in the
cases mentioned in this Article shall only become the company’s shareholders
from the day on which their information mentioned in Clause 2 Article 121 of
this Law are fully recorded in the shareholder register.
Article
127. Bond issuance
1. A joint-stock company is
entitled to issue bonds, convertible bonds, and other bonds as prescribed by
law and the company’s charter.
2. Any company that fails to
pay both principal and interest of issued bonds, fails to pay or fails to
completely pays due debts in the last 03 consecutive years may no longer issue
bonds, unless otherwise prescribed by regulations of law on securities.
3. Clause 2 of this Article
does not apply to issuance of bonds to creditors being selected financial
institutions.
4. Unless otherwise prescribed
by the company’s charter, the Board of Directors is entitled to decide the type
of bonds, total value of bonds, and issuance time, provided a report is
submitted to the nearest General Meeting of Shareholders. The report shall be
enclosed with documents and explanations for the resolution on bond issuance
made by the Board of Directors.
5. In case bonds issued by a
joint-stock company are converted into shares, procedures for shares offering
prescribed in this Law and relevant regulations of law shall be followed. The
company shall register a change to charter capital within 10 days from the day
on which the conversion process is completed.
Article
128. Purchases of shares and bonds
Shares, bonds of a joint-stock
companies may be purchased with Vietnam Dong, convertible foreign currencies,
gold, land use right value, value of intellectual property rights,
technologies, technical secrets, and other assets prescribed by the company’s
charter. The payment shall be made in a lump sum.
Article
129. Repurchase of shares at the request of shareholders
1. Any shareholder who votes
against the Resolution on the company’s restructuring or changes to the shareholders’
rights and obligations prescribed in the company’s charter shall be entitled to
request the company to repurchase his/her shares. The request shall be made in
writing, specifying the shareholder’s name, address, amount of each type of
shares, wanted prices, and reasons for requesting the repurchase. The request
shall be sent to the company within 10 days from the day on which the General
Meeting of Shareholders ratifies the Resolution on the issues mentioned in this
Clause.
2. The company shall repurchase
shares at the request of shareholders as prescribed in Clause 1 of this Article
at market prices or prices determined in accordance with the company’s charter
within 90 days from the day on which the request is received. If an
agreement on the price is not reached, both parties may request a professional
valuation organization to carry out the valuation. The company shall
recommend at least 03 professional valuation organizations for shareholders to
choose. The decision given by such organization shall be final.
Article
130. Repurchase of shares under the company’s decision
The company may repurchase up
to 30% of total ordinary shares that are sold, part of or all of shares with
preferred dividends that are sold as follows:
1. The Board of Directors may
decide repurchase of up to 10% of total shares of each type that are offered
within 12 months. In other cases, the repurchase of shares shall be decided by
the General Meeting of Shareholders;
2. The Board of Directors
shall decide repurchase prices. Repurchase price of ordinary shares must not
exceed the market price at the time of repurchase, except for the case
mentioned in Clause 3 of this Article. With regard to other types of shares,
unless otherwise prescribed by the company’s charter or agreed between the
company and relevant shareholders, the repurchase prices must not fall below
the market price;
3. The company may repurchase
the shares held by each shareholder in proportion to his/her holding in the
company. In this case, a notification of the decision to repurchase shares must
be sent by registered mail to all shareholders within 30 days from the day on
which such decision is ratified. The notification must contain the name,
headquarter address of the company, total amount of shares and types of shares
repurchased, repurchase prices or rules for determination of repurchase prices;
procedures and deadline for payment; procedures and deadline for shareholders
to offer their shares to the company.
Any shareholder that agrees to
resell his/her shares shall send the offering by registered mail to the company
within 30 days from the notification date. The offering shall contain the full
name, permanent residence, Nationality, ID/passport number if the shareholder
is an individual, name, enterprise identification number or establishment
decision number, headquarter address if the shareholder is an organization; the
shares being held and the shares being offered; method of payment, signature of
the shareholder or the shareholder’s legal representative. The company shall
only repurchase shares offered by the said deadline.
Article
131. Conditions for payment and settlement of repurchased shares
1. The company may pay for the
repurchased shares to the shareholders as prescribed in Article 129 and Article
130 of this Law of right after fully paying for the repurchased shares, the
company is still able to pay its debts and other liabilities.
2. Shares repurchased under
Article 129 and Article 130 of this Law are considered unsold shares as defined
in Clause 4 Article 111 of this Law. The company shall follow procedures for
making a decrease to charter capital, which is equal to the total face value of
shares repurchased by the company within 10 from the completion of payment for
repurchased shares, unless otherwise prescribed by regulations of law on
securities.
3. Share certificates that
certify the ownership of repurchased shares must be destroyed as soon as the
corresponding shares are fully paid. The Chairperson of the Board of Directors
and Director/General Director are jointly responsible for the damage to the
company caused by failure to destroy or delayed destruction of share
certificates.
4. After repurchased shares
are fully paid, if the total asset value written in the company’s accounting
books is reduced by more than 10%, the company shall notify all of its
creditors within 15 days from the day on which repurchased shares are fully
paid.
Article
132. Dividend payment
1. Dividends on preferred
shares shall be paid under conditions applied to each type of preferred shares.
2. Dividends on ordinary
shares are determined according to the net profit earned and the dividend
payment extract from the undistributed profit of the company. A joint-stock
company may only pay dividends on ordinary shares when all of the conditions
below are satisfied:
a) The company has fulfilled
tax liability and other financial obligations as prescribed by law;
b) The company’s funds have
been established and developed; previous losses are fully offset against as
prescribed by law and the company’s charter;
c) Right after the dividend is
fully paid, the company is still able to pay due debts and other liabilities.
3. Dividends may be paid in
cash, the company’s shares, or other assets prescribed by the company’s
charter. If dividend is paid in cash, the currency shall be VND; it is
permissible to make dividend payment by checks, wire transfer, or payment order
by post to the shareholders’ permanent residences or mailing addresses.
4. Dividend must be fully paid
within 06 months from the end of the Annual General Meeting of shareholders.
The Board of Directors shall make a list of shareholders receiving dividends,
determine the levels of dividend on each share, deadline and method of payment
at least 03 days before the dividend payment. The notifications of dividend
payment shall be sent by registered mail to the addresses in the shareholder
register at least 15 days before dividend payment. The notification shall
contain:
a) Name, headquarter address
of the company;
b) Full names, permanent
residences, nationalities, ID/passport numbers of shareholders being
individuals;
c) Names, enterprise ID
numbers or establishment decision numbers, and the headquarter addresses of
shareholders being organizations;
d) Amount of each type of
shares of shareholder; level of dividend on each type of shares, and total
dividend received by the shareholder;
dd) Time and method of
dividend payment;
e) Full name and signature of
the Chairperson of the Board of Directors and company’s legal representative.
5. If a shareholder transfers
his/her shares during the period from the completion of the compilation of the
list of shareholders and the time of dividend payment, the transferor shall
receive dividend from the company.
6. In case dividends are paid
with shares, the company is not required to follow procedures for share
offering prescribed in Articles 122, 123, and 124 of this Law. The company
shall register an increase to charter capital, which equal to value of shares
used as dividend payment, within 10 days from completion of the dividend
payment.
Article
133. Withdrawal of payment for repurchased shares or dividends
If repurchased shares are paid
against regulations in Clause 1 Article 131 of this Law or dividends are paid
against regulations in Article 132 of this Law, the shareholders shall return
the company the money or assets received; in case a shareholder is not able to
return them, all members of the Board of Directors shall be jointly responsible
for the debts and liabilities up to the value of money or assets that are not
returned by shareholders.
Article
134. Organizational structure of a joint-stock company
1. Every joint-stock company
is entitled to decide whether to organize and operate according to one of the
two models below, unless otherwise prescribed by regulations of law on
securities:
a) The General Meeting of
Shareholders, the Board of Directors, the Control Board, and the
Director/General Director. If the joint-stock company has fewer than 11
shareholders and the shareholders being organizations hold less than 50% of
total shares of the company, the Control Board is not necessary;
b)The General Meeting of
Shareholders, the Board of Directors, and the Director/General Director. In
this case, at least 20% of members of the Board of Directors must be
independent members and there must be an internal Control Board affiliated to
the Board of Directors. Independent members shall play the roles supervisors
and control the company’s administration.
2. If there is only one legal
representative, the Chairperson of the Board of Directors or the
Director/General Director shall be the legal representative; unless otherwise
prescribed by the company’s charter, the Chairperson of the Board of Directors
shall be the legal representative of the company. If there are more than one
legal representatives, the Chairperson of the Board of Directors and the
Director/General Director shall naturally be the legal representatives of the
company.
Article
135. General Meeting of Shareholders
1. The General Meeting of Shareholders
consists of all shareholders having voting right and is the supreme regulatory
body of a joint-stock company.
2. The General Meeting of
Shareholders has the following rights and obligations:
a) Ratify the company’s
development orientation;
b) Decide the types of shares
and amount of each type of authorized shares; decide annual dividend payment of
each type of shares;
c) Elect, dismiss, discharge
from duty members of the Board of Directors and Controllers;
d) Decide investment or sale
of assets of which the values are equal to or higher than 35% of the total
asset value written in the latest financial statement of the company, unless a
smaller rate is prescribed by the company’s charter;
dd) Decide amendments to the
company’s charter;
e) Ratify annual financial
statements;
g) Decide repurchase of more
than 10% of total sold shares of each type;
h) Consider taking actions
against violations committed by the Board of Directors and the Control Board
that cause damage to the company and its shareholders;
i) Decide the company’s
restructuring and dissolution;
k) Perform other rights and
obligations prescribed by this Law and the company’s charter.
Article
136. Power to convene General Meetings of Shareholders
1. An annual general meeting
shall be held one per year. Apart from annual general meetings, extraordinary
general meetings may be held . The General Meeting of Shareholders must be held
within Vietnam’s territory. If the General Meeting of Shareholders is held at
multiple locations at the same time, the location of the General Meeting of
Shareholders shall be the place where the chair is present.
2. An annual general meeting
shall be held within 04 months from the end of the fiscal year. At the request
of the Board of Directors, the business registration authority may extend this
deadline. Nevertheless, the time limit shall not exceed 06 months from the end of the fiscal year.
The Annual General Meeting of
Shareholders shall discuss and ratify the following issues:
a) The company’s annual business plan;
b) The annual financial
statement;
c) Report of the Board of
Directors on business administration and performance of the Board of Directors
and each member thereof;
d) Report of the Control Board
on the company’s business outcome, performance of the Board of Directors,
Director/General Director;
dd) Self-assessment report of
the Control Board and each Controller;
e) Level of dividend on each
share of each type;
g) Other issues within the
competence of the General Meeting of Shareholders.
3. 3. The Board of Directors
shall convene a extraordinary General Meeting of Shareholders in the following
cases:
a) The meeting is deemed
necessary for the company’s interests;
b) The number of remaining
members of the Board of Directors, the Control Board is smaller than the
minimum number prescribed by law;
c) The meeting is requested by
the shareholder or group of shareholders mentioned in Clause 2 Article 144 of
this Law;
d) At the request of the
Control Board;
dd) Other cases prescribed by
law and the company’s charter.
4. Unless otherwise prescribed
by the company’s charter, the Board of Directors shall convene a the General
Meeting of Shareholders within 30 days from the day on which the number of
remaining members of the Board of Directors is as prescribed in Point b or the
request mentioned in Point c and Point d Clause 3 of this Article is received.
If the Board of Directors
fails to convene the General Meeting of Shareholders as prescribed, the
Chairperson of the Board of Directors and members of the Board of Directors
shall take legal responsibility and pay compensation for any damage to the
company.
5. If the Board of Directors fails to convene
the General Meeting of Shareholders as prescribed in Clause 4 of this Article,
the Control Board shall convene the General Meeting of Shareholders within the
next 30 days instead of the Board of Directors in accordance with this Law.
If the Control Board fails to convene the
General Meeting of Shareholders as prescribed, the Control Board shall take
legal responsibility and pay compensation for any damage to the company.
6. If the Control Board fails
to convene the General Meeting of Shareholders as prescribed in Clause 4 of
this Article, the shareholder or group of shareholders mentioned in Clause 2
Article 114 of this Law is entitled to, on behalf of the company, convene the
General Meeting of Shareholders in accordance with this Law.
7. The convener of the General
Meeting of Shareholders shall perform the following tasks:
a) Make a list of shareholders
entitled to attend the meeting;
b) Provide information and
settle complaints about the list of shareholders;
c) Prepare the program and
agenda of the meeting;
d) Prepare documents for the
meeting;
dd) Draft Resolutions of the
General Meeting of Shareholders according to the intended contents of the
meeting; compile the list and descriptions of candidates for the Board of
Directors and the Control Board;
e) Determine the time and
location of the meeting;
g) Send invitations to every
shareholders entitled to attend the meeting as prescribed in this Law;
h) Perform other tasks serving
the meeting.
8. The cost of convention and
organization of the General Meeting of Shareholders prescribed in Clauses 4, 5,
and 6 of this Article shall be reimbursed by the company.
Article
137. List of shareholders entitled to attend General Meeting of Shareholders
1. The list of shareholders
entitled to attend General Meeting of Shareholders shall be compiled according
to the company’s shareholder register. The list of shareholders entitled to attend
General Meeting of Shareholders shall be made not sooner than 05 days before
invitations to the General Meeting of Shareholders are sent, unless a longer
period is prescribed by the company’s charter.
2. The list of shareholders
entitled to attend the General Meeting of Shareholders shall contain full
names, permanent residences, nationalities, ID/passport numbers of shareholders
being individuals; names, enterprise ID numbers or establishment decision
numbers, addresses of headquarters of shareholders being organizations; amount
of each type of shares; shareholder registration date and number of each
shareholder.
3. Shareholders are entitled
to inspect, examine, copy the list of shareholders entitled to attend the
General Meeting of Shareholders; request adjustment to incorrect information or
addition of necessary information about themselves to the list. The company’s
manager must promptly provide information about in the shareholder register,
adjust incorrect information at the request of shareholders; pay compensation
for damage caused by failure to provide information or failure to provide
timely, accurate information in the shareholder register on request. Procedures
for requesting provision of information in the shareholder register shall
comply with the company’s charter.
Article
138. Agenda and contents of General Meeting of Shareholders
1. The convener of the General
Meeting of Shareholders shall prepare its agenda and contents.
2. The shareholder or group of
shareholders mentioned in Clause 2 Article 114 of this Law is entitled to
propose additional issues to the agenda of the General Meeting of Shareholders.
The proposal must be made in writing and sent to the company at least 03
working days before the opening date, unless otherwise prescribed by the
company’s charter. The proposal must specify the name(s) of shareholder(s),
amount of each type of shares or equivalent information, additional issues
proposed to the agenda.
3. The convener is entitled to
reject the proposal mentioned in Clause 2 of this Article in one of the
following cases:
a) The proposal is not sent by
the deadline; or the proposal is not adequate or not valid;
b) The proposed issue is
beyond the competence of the General Meeting of Shareholders;
c) Other cases prescribed by
the company’s charter.
4. The convener of the General
Meeting of Shareholders must accept and include the proposal mentioned in
Clause 2 of this Article to the intended agenda and contents of the meeting,
except for the case in Clause 3 of this Article. The proposal shall be
officially included on the agenda and contents of the meeting if it is approved
by the General Meeting of Shareholders.
Article
139. Invitation to General Meeting of Shareholders
1. The convener of the General
Meeting of Shareholders shall send invitations to all shareholders on the list
of shareholders entitled to attend the General Meeting of Shareholders at least
10 days before the opening date, unless a longer period is prescribed by the
company’s charter. Every invitation must contain the name, headquarter address,
enterprise ID number; name, permanent residence of the shareholder; time and
location of meeting, and other requirements applied to participants.
2. Invitations shall be sent
by registered mail to mailing addresses of shareholders; the invitation shall
also be posted on the company’s website and a central or local daily newspaper
where necessary according to the company’s charter.
3. The invitation shall be
enclosed with the following documents:
a) The agenda, documents used during
the meeting, and draft resolution on each issue on the agenda;
b) The ballot;
c) The form to appoint
authorized representative to attend the meeting.
4. If the company has a
website, meeting documents mentioned in Clause 3 of this Article may be posted
on such website instead of being enclosed with the invitation. In this case,
the invitation must specify the site and method of downloading documents, and
the company must send such meeting documents to shareholders at their request.
Article
140. Exercising the right to attend General Meeting of Shareholders
1. A shareholder may directly
attend the meeting, authorizes a person in writing to attend the meeting, or
uses one of the method mentioned in Clause 2 of this Article. If a shareholder
being an organization does not have an authorized representative mentioned in
Clause 4 Article 15 of this Law, another person shall be authorized to attend
the General Meeting of Shareholders.
The authorization of
representatives to attend the General Meeting of Shareholders must be made in
writing using the form provided by the company. The persons authorized to
attend the General Meeting of Shareholders must present the letters of
authorization before entering the meeting room.
2. A shareholder is considered
to have attended and voted at the General Meeting of Shareholders in the
following cases:
a) The shareholder attends and
directly casts votes at the meeting;
b) The shareholder authorizes
another person to attend and cast votes at the meeting;
c) The shareholder attends and
casts votes through online meeting, electronic voting, or using another
electronic medium;
d) The shareholder sends votes
to the meeting by post, fax, or email.
Article
141. Conditions for convening General Meeting of Shareholders
1. A General Meeting of
Shareholders shall be held when it is attended by a number of shareholders
represent at least 51% of votes; the specific ratio shall be prescribed by the
company’s charter.
2. If the conditions for
holding the first General Meeting prescribed in Clause 1 of this Article are
not satisfied, the second General Meeting shall be held within 30 working days
from the intended date of the first General Meeting, unless otherwise
prescribed by the company’s charter. The second General Meeting of Shareholders
shall be held when it is attended by a number of shareholders represent at
least 33% of votes; the specific ratio shall be prescribed by the company’s
charter.
3. If the conditions for holding the second
General Meeting prescribed in Clause 2 of this Article are not satisfied, the
third General Meeting shall be held within 20 working days from the intended
date of the second General Meeting, unless otherwise prescribed by the
company’s charter. In
this case, the second General Meeting of Shareholders shall be held regardless
of the number of votes of the attending shareholders.
4. Only the General Meeting of
Shareholders is entitled to change the agenda enclosed with the invitation
mentioned in Article 139 of this Law.
Article
142. Meeting and voting process at General Meeting of Shareholders
Unless otherwise prescribed by
the company’s charter, meeting and voting process at General Meeting of
Shareholders shall be as follows:
1. Registration of
shareholders who attend the General Meeting of Shareholders shall be carried
out before opening the meeting;
2. Election of the Chair,
Secretary, and counting board:
a) The Chairperson of the
Board of Directors shall chair the meetings convened by the Board of Directors;
In case the Chairperson is temporarily absent or not capable of working, other
members of the Board of Directors shall elect one of them to chair the meeting
under the majority rule; If a chair is not elected, the Chief of the Control
Board shall direct the General Meeting of Shareholders to elect a chair and the
person that receives most votes shall chair the meeting;
b) In other cases, the person
that signs the decision to convene the General Meeting of Shareholders shall
direct the General Meeting of Shareholders to elect a chair and the person that
receives most votes shall chair the meeting;
c) The chair shall appoint one
or some people as the secretary(ies);
d) The General Meeting of
Shareholders shall elect one or some people to the counting board at the
request of the chair;
3. The agenda and contents of
General Meeting of Shareholders must be ratified by the meeting during the
opening session. The agenda must specify the time for each issue on the agenda;
4. The chair is entitled to
take necessary and reasonable measures to control the meeting in an orderly
manner and in conformity with the ratified agenda so that it reflects the
demands of the majority of participants;
5. The General Meeting of
Shareholders shall discuss and vote on each issue on the agenda. The voting
shall be carried out by collecting affirmative votes, then negative votes, then
count the affirmative votes, negative votes, and abstentions. The vote counting
result shall be announced by the chair right before the end of the meeting,
unless otherwise prescribed by the company’s charter;
6. Shareholders or authorized
participants who arrive after the opening of the meeting may register and has
the right to vote after registration; in this case, the effect of the issues
voted on previously shall remain unchanged;
7. The convener of the General
Meeting of Shareholders has the rights to:
a) Request all participants to
undergo inspection or other legitimate, reasonable security measures;
b) Request competent
authorities to maintain order at the meeting; expel those who act against the chair's
direction, cause disruption, obstruct the normal progress of the meeting, or
refuse to comply with security check requirements from the General Meeting of
Shareholders;
8. The chair may delay a
General Meeting of Shareholders that has been attended by all registered
participants until a later time or change the meeting location in the following
cases:
a) The current location does
not have convenient seats for all participants;
b) Communication devices at
the current location are not sufficient for attending shareholders to discuss
and vote;
c) There is a participant that
disrupts the order and threatens to obstruct the fair and legal progress of the
meeting.
The delay shall not exceed 03
days from the initial opening date;
9. If the char delays or suspends
the General Meeting of Shareholders against Clause 8 of this Article, the
General Meeting of Shareholders shall elect another person among the
participants to replace the chair until the end of the meeting; all Resolutions
ratified at the meeting shall be effective.
Article
143. Formalities to ratify Resolutions of the General Meeting of Shareholders
1. The General Meeting of
Shareholders shall ratify decisions within its competence by voting at the
meeting or by absentee voting.
2. Unless otherwise prescribed
by the company’s charter, Resolutions of the General Meeting of Shareholders
about the following issues shall be ratified by voting at the General Meeting
of Shareholders:
a) Amendments to the company’s
charter;
b) The company’s development
orientation;
c) Types of shares and total
amount of each type;
d) Election, dismissal,
discharge from duty of members of the Board of Directors and the Control Board;
dd) Decision to make
investments or sell assets of which the values are equal to or higher than 35%
of the total asset value written in the latest financial statement of the
company, or a smaller rate prescribed by the company’s charter;
e) Ratify annual financial
statements;
g) Restructuring or
dissolution of the company.
Article
144. Conditions for a Resolution to be ratified
1. A Resolution on one of the
following issues shall be ratified when it is approved by a number of
shareholders that represents at least 65% of votes of attending shareholders;
the specific ratio shall be prescribed by the company’s charter:
a) Types of shares and total
amount of each type;
b) Changes of business lines;
c) Change of the company’s
organizational structure;
d) Project of investment or
sale assets of which the values are equal to or higher than 35% of the total
asset value written in the latest financial statement of the company, or a
smaller rate prescribed by the company’s charter;
dd) Restructuring or
dissolution of the company;
e) Other cases defined by the
company’s charter.
2. Other Resolutions shall be
ratified when they are approved by a number of shareholders that represents at
least 51% of votes of attending shareholders, except for the cases in Clause 1
and Clause 3 of this Article; the specific ratio shall be prescribed by the
company’s charter.
3. Unless otherwise prescribed
by the company’s charter, Members of the Board of Directors and the Control
Board shall be elected by cumulative voting. Accordingly, each shareholder
shall have a number of votes that is proportional to his/her shares multiplied
by (x) the number of members of the Board of Directors or the Control Board.
The shareholder may cast part of or all of his/her votes for one or some
candidates. Elected Members of the Board of Directors or Controllers shall be
determined by the number of votes they receive in descending order, starting
from the candidates that receive the most votes until the number of members are
sufficient according to the company’s charter. If there are 02 or more
candidates that receive the same votes for the last position of the Board of
Directors or the Control Board, they shall be voted again or selected according
to the voting criteria or the company’s charter.
4. In case of absentee voting,
a Resolution shall be ratified if it is approved by a number of shareholders
that represents at least 51% of votes; the specific ratio shall be prescribed
by the company’s charter.
5. Resolutions of the General
Meeting of Shareholders shall be notified to all shareholders who are entitled
to attend the General Meeting of Shareholders within 15 days from the
ratification date. If the company has a website, such Resolutions may be posted
on the website instead of being sent to shareholders.
Article
145. Power and formalities to carry out absentee voting of shareholders to
ratify Resolutions of the General Meeting of Shareholders
Unless otherwise prescribed by
the company’s charter, the power and formalities to carry out absentee voting
of shareholders by to ratify Resolutions of the General Meeting of Shareholders
shall be as follows:
1. The Board of Directors is
entitled to carry out absentee voting of shareholders to ratify Resolution of
the General Meeting of Shareholders when it is deemed necessary for the
company’s interest;
2. The Board of Directors
shall prepare absentee ballots, Draft Resolutions of the General Meeting of
Shareholders, descriptions thereof, and send them to shareholders having voting
right at least 10 days before the deadline for submitting absentee ballots,
unless a longer period is prescribed by the company’s charter. The list of
shareholders to receive absentee ballots shall be compiled in accordance with
Clause 1 and Clause 2 Article 137 of this Law. Requirements and methods to send
absentee ballots and enclosed documents are specified in Article 139 of this
Law;
3. The absentee ballot shall
contain:
a) Name, ID number,
headquarter address of the enterprise;
b) Purposes of the voting;
d) Full name, permanent
residence, nationality, ID/passport number if the shareholder is an individual;
name, enterprise identification number or establishment decision number, and
the headquarter address if the shareholder is an organization; or full name,
permanent residence, nationality, ID/passport number of the authorized
representative if the shareholder is an organization; Amount of shares of each
type and number of votes of the shareholder.
d) The issues that need
voting;
dd) Options including
affirmative, negative, and abstentions;
e) Deadline for submitting the
completed absentee ballot to the company;
g) Full name and signature of
the Chairperson of the Board of Directors and company’s legal representative;
4. Shareholders may send
completed absentee ballots to the company in the following manner:
a) By post. The completed
absentee ballots must bear the signature of the shareholder if the shareholder
is an individual, or signature of the authorized representative or legal
representative if the shareholder is an organization. Every absentee ballot
sent to the company must be put into sealed envelopes. Envelopes must not be
opened before counting;
b) By fax or email. Absentee
ballots sent by fax or email must be kept confidential until the vote counting
time.
Absentee ballots sent to the
company after the deadline written therein, absentee ballots sent by post in
envelopes that are opened, absentee ballots sent by fax or email that are
revealed are all invalid. If a absentee ballot is not submitted, it will be
excluded from voting;
5. The Board of Directors
shall count the votes and make a vote counting record before the Control Board
or shareholders that do not hold managerial positions in the company.
The vote counting record must
contain the following information:
a) Name, ID number,
headquarter address of the enterprise;
b) Purposes and issues that
need voting;
c) The number of shareholders
and total number of votes casted. The numbers of valid and invalid votes,
methods of sending, enclosed with the list of voting shareholders;
d) Total number of affirmative
votes, negative votes, and abstentions on each issue;
dd) The issues ratified;
e) Full name and signature of
the Chairperson of the Board of Directors, the company’s legal representative,
vote counting supervisors, and vote counters.
Members of the Board of
Directors, vote counters and vote counting supervisors are jointly responsible
for the truthfulness, accuracy of the vote counting record; jointly responsible
for damage caused by the decisions ratified because of untruthful, incorrect
counts of votes;
6. The vote counting record
shall be sent to all shareholders within 15 days from the completion date of
vote counting. If the company has a website, the vote counting record may be
posted on such website instead of being sent to shareholders;
7. Completed absentee ballots,
the vote counting record, ratified Resolutions, and relevant documents enclosed
with absentee ballots shall be kept at the company’s headquarter;
8. Resolutions ratified by
absentee voting are as valuable as those ratified at the General Meeting of
Shareholders.
Article
146. Minutes of General Meeting of Shareholders
1. The General Meeting of
Shareholders must be recorded in writing, audio recordings, or other electronic
means of recordings. The meeting minutes must be made in Vietnamese language
(additional foreign language is permitted) and has the following information:
a) Name, ID number,
headquarter address of the enterprise;
b) Time and location of the
General Meeting of Shareholders;
c) Agenda and contents of the
meeting;
d) Full names of the chair and
secretary
dd) Summary of the meeting and
opinions given at the General Meeting of Shareholders with regard to each issue
on the agenda;
e) The number of shareholders
and total number of votes of attending shareholders; list of registered
shareholders, representatives of shareholders, corresponding amount shares and
votes;
g) Total votes on each issue,
specifying the voting method, numbers of valid votes, invalid votes,
affirmative votes, negative votes; corresponding ratio to total votes of
attending shareholders;
h) The issues ratified and
corresponding ratio of affirmative votes;
i) Signatures of the chair and
secretary.
The minutes made in Vietnamese
language and foreign languages shall have equal legal effectiveness. In case of
any discrepancies between the Vietnamese version and foreign language version,
the Vietnamese version shall prevail.
2. The minutes of the General
Meeting of Shareholders must be completed and ratified before the end of the
meeting.
3. The chair and secretary are
jointly responsible for the truthfulness and accuracy of the minutes.
The minutes of the General
Meeting of Shareholders must be send to every shareholder within 15 days from
the ending date of the meeting; the vote counting record may be posted on the
company’s website (if any) instead of being sent to shareholders.
The minutes of the General
Meeting of Shareholders, list of registered shareholders, ratified Resolutions,
and relevant documents enclosed with the invitations must be kept at the
company’s headquarter.
Article
147. Request for annulment of Resolutions of the General Meeting of
Shareholders
Within 90 days from the day on
which the minutes or the vote counting record is received, the shareholder or
group of shareholders mentioned in Clause 2 Article 114 of this Law may request
a court or arbitral tribunal to consider annulling the Resolution or part of
the Resolution of the General Meeting of Shareholders in the following cases:
1. Procedures for convening
the meeting and making decisions of the General Meeting of Shareholders are not
conformable with this Law and the company’s charter, except for the case in
Clause 2 Article 148 of this Law;
2. Contents of the Resolution
contravenes the law or the company’s charter.
Article
148. Effect of Resolutions of the General Meeting of Shareholders
1. A Resolution of the General
Meeting of Shareholders is effective from the day on which it is ratified or on
the effective date written thereon.
2. Any Resolution of the
General Meeting of Shareholders which is ratified with 100% of voting shares
shall be legitimate and effective even if the procedures for ratifying such
Resolution are not conformable with regulations.
3. In case a shareholder or
group of shareholders request the court or arbitral tribunal to annual a
Resolution of the General Meeting of Shareholders as prescribed in Article 147
of this Law, such Resolution is still effective until a dissenting decision is
made by the court or arbitral tribunal, except for the case in which temporary
emergency measures are taken under a decision of a competent authority.
Article
149. Board of Directors
1. The Board of Directors is a
regulatory body of the company, has the power to, on behalf of the company,
make decisions, perform the company’s rights and obligations beyond the
competence of the General Meeting of Shareholders.
2. The Board of members has
the following rights and obligations:
a) Decide the strategies,
midterm development plans, and annual business plans of the company;
b) Propose types of shares and
total authorized shares of each type;
c) Decide the sale of new
shares within the amount of authorized shares of each type; decide to raise
additional capital in other manners;
d) Decide selling prices of
the company’s shares and bonds;
dd) Decide repurchases of
shares according to Clause 1 Article 130 of this Law;
e) Decide investment plans and
projects of investment within its competence and limits prescribed by law;
g) Decide solutions for market
development, marketing, and technology;
h) Approve sale, loan,
borrowing contracts, and other contracts of which the values are equal to or
higher than 35% of the total asset value written in the latest financial
statement of the company, unless another rate is prescribed by the company’s
charter. This Point does not apply to the contracts and transactions mentioned in
Point d Clause 2 Article 135, Clause 1 and Clause 3 Article 162 of this Law;
i) Elect, dismiss, discharge
from duty the Chairperson of the Board of Directors; designate, dismiss, sign
contracts, terminate contracts with the Director/General Director and other key
managers prescribed by the company’s charter; decide salaries and other
benefits of such managers; appoint representative to participate in the Board
of members or the General Meeting of Shareholders of another company; decide
the wages and other benefits of such persons;
k) Supervise, direct the
Director/General Director and other managers to run the company’s everyday
business operation;
l) Decide the organizational
structure, rules and regulations of the company, establishment of subsidiaries,
branches, representative office, capital contributions to or purchase of shares
of other enterprises;
m) Approve the agenda and
documents of the General Meeting of Shareholders, convene the General Meeting
of Shareholders or carry out absentee voting for the General Meeting of
Shareholders to ratify decisions;
n) Submit annual financial
statements to the General Meeting of Shareholders;
o) Propose the level of
dividend payment; decide the deadline and procedures for dividend payment or
settlement of losses incurred during the business operation;
p) Propose restructuring,
dissolution, petition for bankruptcy of the company;
q) Perform other rights and
obligations prescribed in this Law and the company’s charter.
3. The Board of Directors
shall ratify decisions by voting at meetings, absentee voting, or another
voting method prescribed by the company’s charter. Each member of Board of
Directors has a vote.
4. While performing its
functions, rights and obligations, the Board of Directors shall comply with
law, the company’s charter, and Resolutions of the General Meeting of
Shareholders. In case a Resolution is ratified by the Board of Directors
against the law or the company’s charter and thus causes damage to the company,
every member that approves the ratification of such Resolution shall be jointly
responsible for such Resolution and pay compensation for the company. Members
who object such Resolution shall not take responsibility. In this case, any
shareholder that hold the company’s shares for at least 01 year shall be
entitled to request the Board of Directors to suspend the implementation of
such Resolution.
Article
150. Term of office and number of Members of the Board of Directors
1. The Board of Directors
consists of 03 to 11 members. The company’s charter shall specify the number of
Members of the Board of Directors.
2. Each Member of the Board of
Directors and independent member of the Board of Directors has a term of office
of up to 05 years without term limit. The number of terms, specific term period,
number of Members of the Board of Directors required to reside in Vietnam shall
be specified in the company’s charter.
3. In case the term of office of all Members
of the Board of Directors expires at the same time, they are still Members of
the Board of Directors until new members are elected and take over the office,
unless otherwise prescribed by the company’s charter.
4. If the joint-stock company
is organized according to Point b Clause 1 Article 134 of this Law, documents
and transactions of the company must bear the text “Thành viên độc lập”
(“Independent member") before the names of corresponding Members of the
Board of Directors.
5. The company’s charter shall
specify the number, rights, obligations, method of operation and cooperation of
independent members of the Board of Directors.
Article
151. Standards and conditions for Members of the Board of Directors
1. Members of the Board of
Directors must:
a) be legally competent,
not be banned from business administration as prescribed in Clause 2 Article 18
of this Article;
b) has qualifications and
experience of business administration; Members of the Board of Directors are
not necessarily shareholders of the company, unless otherwise prescribed by the
company’s charter.
c) Members of the Board of Directors
may concurrently hold the position of Members of the Board of Directors of
other companies.
d) With regard to the
subsidiaries over 50% of charter capital of which is held by the State, Members
of the Board of Directors must not be spouses, parents, adoptive parents,
children, adopted children, siblings of the Director/General Director and other
managers of the building work; must not be related persons of the manager and
the person competent to designate the manager of the parent company.
2. Unless otherwise prescribed
by regulations of law on securities, independent members of the Board of
Directors prescribed in Point b Clause 1 Article 134 of this law must:
a) Not be a current employee
of the company or its subsidiaries; not be a person that used to work for the
company or the company’s subsidiaries over the previous 03 consecutive years.
b) Not be a person receiving
salaries, wages from the company, except for the benefits to which Members of
the Board of Directors are entitled;
c) not have a spouse, birth
parent, adoptive parent, birth child, adopted child, or sibling being a major
shareholder of the company, being a manager of the company or the company’s
subsidiary;
d) not directly or indirectly
hold at least 1% of the company’s voting shares;
dd) Not ever hold the position
of Member of the Board of Directors, the Control Board over at least the
previous 05 consecutive years.
3. Independent members of the
Board of Directors must notify the Board of Directors of their failure to
satisfy the conditions prescribed in Clause 2 of this Article. Such members are
obviously no longer independent members of the Board of Directors from the day
on which conditions are not satisfied. The Board of Directors shall report the
cases in which independent members of the Board of Directors no longer satisfy
conditions at the nearest General Meeting of Shareholders or convene a General
Meeting of Shareholders to elect new independent members within 06 months from
the day on which the independent member’s notification is received.
Article
152. Chairperson of the Board of Directors
1. The Board of Directors
shall elect a member of the Board of Directors as the Chairperson. The
Chairperson of the Board of Directors may concurrently hold the position of
Director/General Director, except for the cases in Clause 2 of this Article and
unless otherwise prescribed by regulations of law on securities and the
company’s charter.
2. The Chairperson of the
Board of Directors of any joint-stock company over 50% of voting shares are held
by the State may not concurrently hold the position of Director/General
Director.
3. The Chairperson of the
Board of Directors has the following rights and obligations:
a) Formulate operation plans
of the Board of Directors;
b) Prepare the agenda, contents,
and documents of meetings; convene and chair meetings of the Board of
Directors;
c) Organize the ratification of Resolutions
of the Board of Directors;
d) Supervise the
implementation of Resolutions of the Board of Directors;
dd) Chair meetings of the
General Meeting of Shareholders and the Board of Directors;;
e) Perform other rights and
obligations prescribed in this Law and the company’s charter.
4. If the Chairperson of the Board of
Directors is absent or is not able to fulfill his/her duties, the Chairperson
shall authorize another member in writing to perform rights and obligations of
the Chairperson of the Board of Directors in accordance with the company’s
charter. In case
no one is authorized , other members shall elect one of them as a temporary
Chairperson of the Board of Directors under the majority rule.
5. Where necessary, the
Chairperson of the Board of Directors shall hire a secretary to assist the
Board of Directors and the Chairperson of the Board of Directors in performing
their duties in accordance with law and the company’s charter. The company’s
secretary has the following rights and obligations:
a) Assist the convention of the General
Meeting of Shareholders and meetings of the Board of Directors; making meeting
minutes;
b) Assist Members of the Board
of Directors in performing their rights and obligations;
c) Assist the Board of
Directors in applying and implementing the company’s administration principles;
d) Assist the company in
building shareholder relationships and protecting the lawful rights and
interests of shareholders;
dd) Assist the company in
fulfilling its obligation to provide information, disclose information and
administrative procedures;
e) Perform other rights and
obligations prescribed by the company’s charter.
6. The Chairperson of the
Board of Directors may be dismissed under a decision of the Board of Directors.
Article
153. Meetings of the Board of Directors
1. The Chairperson of the
Board of Directors shall be elected during the first meeting of the new Board
of Directors within 07 working days from the end of the voting. This meeting
shall be convened and chaired by the member that receives the most votes. If
there is more than one member who has the highest votes, they shall be voted
for by members under the majority rule to convene the Board of Directors.
2. The Board of Directors may
hold periodic and extraordinary meetings. The Board of Directors shall hold
meetings at the company’s headquarter or other locations.
3. Meetings of the Board of
Directors shall be held by the Chairperson of the Board of Directors when it is
deemed necessary. At least one meeting shall be held in a quarter.
4. The Chairperson of the
Board of Directors shall convene a meeting of the Board of Directors in the
following cases:
a) The meeting is requested by
the Control Board or independent members
b) The meeting is requested by
the Director/General Director or at least 05 other managers;
c) The meeting is requested by
at least 02 executive members of the Board of Directors;
d) Other cases prescribed by
the company’s charter.
The request must be made in
writing, specifying the purposes, issues that need discussing, and decisions
within the competence of the Board of Directors.
5. The Chairperson of the
Board of Directors shall convene a meeting of the Board of Directors within 07
working days from the day on which the request mentioned in Clause 4 of this
Article is received. If the Chairperson fails to convene the meeting on
request, the Chairperson shall take responsibility for any damage to the
company; the person who makes the request may convene a meeting of the Board of
Directors instead of the Board of Directors.
6. The Chairperson of the
Board of Directors or the convener of the Board of Directors meeting shall send
invitations at least 03 working days before the meeting date, unless otherwise
prescribed by the company’s charter. The invitation must specify the time,
location, agenda, issues, and decisions of the meeting. The invitation must be
enclosed with documents used at the meeting and members’ ballots.
The invitation shall be sent
by post, fax, email, or other means, as long as they reach the mailing address
of every the Board of Directors, which is registered with the company.
7. The Chairperson of the
Board of Directors or the convener shall send invitations and enclosed
documents to Controllers as if they are members of the Board of Directors.
Controllers are entitled to
attend meetings of the Board of Directors, participate in discussion, and must
not cast votes.
8. A meeting of the Board of
Directors shall be held when it is attended by at least three fourths of the
members. If
the number of attending members is not sufficient, the second meeting shall be
convened within 07 days from the initial meeting date, unless a shorter period
is prescribed by the company’s charter. In this case, the meeting shall
be held if it is attended by at least half of Members of the Board of
Directors.
9. A member of the Board of
Directors is considered to have attended and cast votes at a meeting if such
member:
a) Attends and cast votes
directly at the meeting; or
b) Authorizes another person
to attend the meeting as prescribed in Clause 10 of this Article; or
c) Attends and casts votes via
an online meeting or a similar manner; or
d) Sends votes to the meeting
by post, fax, or email.
Votes sent to the meeting by
post must be contained in sealed envelopes and given to the Chairperson of the
Board of Directors at least one hour before the opening time. Votes shall be
open before every participants.
Unless otherwise prescribed by
the company’s charter, a Resolution of the Board of Directors shall be ratified
if it is approved by a majority of attending members; in the event of equal
votes, the Chairperson of the Board of Directors shall have the casting vote.
10. Members must attend all
meetings of the Board of Directors. A member may authorize another person to
attend the meeting if approved by a majority of Members of the Board of
Directors.
Article
154. Minutes of meetings of the Board of Directors
1. Meetings of the Board of
Directors shall be recorded in writing, audio recordings, or other electronic
means. The minutes must be made in Vietnamese languages (additional foreign
languages are permitted) and contain the following information:
a) The enterprise’s name,
enterprise identification number, address of the headquarter;
b) Purposes, agenda, and
contents of the meeting;
c) Time and location of the
meeting;
d) Full name of each attending
member or their authorized person, method of participation; full name of every
member that does not attend and explanations;
dd) Issues discussed and voted
on at the meeting;
e) Summary of opinions of each
attending member in chronological order;
g) Voting result, specifying
the members that casts affirmative votes, negative votes, and abstentions;
h) The issues that have been
ratified;
i) Full names, signatures of
the chair and the minutes maker.
The chair and the minutes
maker are responsible for the truthfulness and accuracy of the minutes of the
Board of Directors meeting.
2. Minutes of the Board of
Directors meetings and documents used during the meetings shall be kept at the
company’s headquarter.
3. The minutes made in
Vietnamese language and those in foreign languages shall have equal value. In case
of any discrepancy between the Vietnamese version and foreign language version,
the former shall prevail.
Article
155. Right to obtain information of Members of the Board of Directors
1. Members of the Board of
Directors are entitled to request the Director/General Director or Deputy
Director/Deputy General Director, and managers of units in the company to
provide information about the financial status and performance of the company
and units in the company.
2. The requested must provide
timely, sufficient, accurate information and documents at the request of
Members of the Board of Directors. Procedures for requesting and providing
information shall be prescribed by the company’s charter.
Article
156. Dismissal, discharge from duty and addition of Members of the Board of
Directors
1. A member of the Board of
Directors shall be dismissed if he or she:
a) fails to satisfy the
standards and conditions prescribed in Article 151 of this Law;
b) fails to participate in
activities of the Board of Directors for 06 consecutive months, except for
force majeure events;
c) tenders a resignation;
d) Other cases prescribed by
the company’s charter.
2. Members of the Board of
Directors may be discharged from duty under Resolutions of the General Meeting
of Shareholders.
3. The Board of Directors
shall convene the General Meeting of Shareholders to elect additional members
of the Board of Directors in the following cases:
a) The number of Members of
the Board of Directors is reduced by more than one third of the number prescribed
by the company’s charter. In this case, the Board of Directors shall convene a
General Meeting of Shareholders within 60 days from the day on which the number
of Members of the Board of Directors is reduced by more than one third;
b) the number of independent
members of the Board of Directors falls below the ratio prescribed in Clause 1
Article 134 of this Law.
In other cases, the nearest
General Meeting of Shareholders shall elect new members to replace those who
have been dismissed or discharged from duty.
Article
157. Director/General Director
1. The Board of Directors
shall appoint one of them as or hire a Director/General Director.
2. The Director/General
Director shall run the company’s everyday business, be supervised by the Board
of Directors, take responsibility to the Board of Directors for performance of
given rights and obligations.
A Director/General Director
shall have a term of office of up to 05 years without term limit.
Standards and conditions for
the Director/General Director are the same as those prescribed in Article 65 of
this Law.
3. The Director/General
Director has the following rights and obligations:
a) Decide important issues
related to the company’s everyday business without decision of the Board of
Directors;
b) Organize the implementation
of Resolutions of the Board of Directors;
c) Organize the implementation
of business plans and investment plans of the company;
d) Propose organizational
structure, internal rules and regulations of the company;
dd) Designate, dismiss, discharge
from duty the company’s managers, except for the positions within the
competence of the Board of Directors;
e) Decide the salaries and
other benefits of the company’s employees, including the managers designated by
the Director/General Director;
g) Hire employees;
h) Suggest plans for dividend
payments or loss settlement;
i) Perform other rights and
obligations prescribed by law, the company’s charter, and Resolutions of the
Board of Directors.
4. The Director/General
Director shall run the company’s everyday business in accordance with law, the
company’s charter, employment contract with the company, and Resolutions of the
Board of Directors. If committing violations which cause damage to the
company, the Director/General Director shall take legal responsibility and pay
compensation for the company.
Article
158. Salaries, remunerations, and other benefits of members of the Board of
Directors, Director/General Director
1. The company is entitled to
pay remunerations to Members of the Board of Directors, salaries to the
Director/General Director and other managers according to the business outcome.
2. Unless otherwise prescribed by the
company’s charter, remunerations, salaries and other benefits of the Members of
the Board of Directors, Director/General Director shall be paid as follows:
b) Members of the Board of
Directors shall receive remunerations and bonuses. Remunerations are calculated
according to the number of working days necessary for fulfilling the duties of
Members of the Board of Directors and daily remuneration. The Board of
Directors shall reach an agreement on estimated remuneration of each member.
The total remuneration of the Board of Directors shall be decided by the
General Meeting of Shareholders at the annual general meeting;
b) Members of the Board of
Directors are entitled to have the cost of accommodation, meals, traveling, and
other reasonable costs incurred during the performance of given duties
reimbursed;
c) The Director/General
Director shall receive salaries and bonuses. The Director/General Director's
salaries and bonuses shall be decided by the Board of Directors.
3. Remunerations of Members of
the Board of Directors and salaries of the Director/General Director and other
managers shall be included in the company’s operating cost in accordance with
regulations of law on corporate income tax, be recorded as a separate item in
the company’s financial statement, and be reported at the annual general
meeting.
Article
159. Publishing related interests
Unless tighter regulations are
prescribed by the company’s charter, related persons and interests of the
company shall be published as follows:
1. The company shall compile
and update the list of related persons of the company in accordance with Clause
17 Article 4 of this Law and their transactions with the company;
2. Members of the Board of
Directors, Controllers, the Director/General Director, and other managers of
the company shall declare their related interests with the company, including:
a) Name, enterprise ID number,
address of the headquarter, business lines of every enterprise of which they
have stakes or shares; the proportion and time of obtainment of such stakes or
shares;
b) Name, enterprise ID number,
address of the headquarter, business lines of every enterprise of which their
related persons have a joint ownership or private ownership of stakes or shares
that make up over 10% of charter capital;
3. The information mentioned
in Clause 2 of this Article shall be declared within 07 working days from the
day on which related interests arise; any adjustment shall be notified to the
company within 07 working days from the day on which such adjustment arises;
4. The List of related persons
and related interests mentioned in Clause 1 and Clause 2 of this Article shall
be published, examined, and copied as follows:
a) The company shall notify
the List of related persons and related interests to the General Meeting of
Shareholders at the annual meeting;
b) The List of related persons
and related interests shall be kept at the enterprise’s headquarter; part or
all of the List may be kept at the company’s branches where necessary;
c) Shareholders and authorized
representatives of shareholders, Members of the Board of Directors, the Control
Board, the Director/General Director, and other managers are entitled to
examine and copy part of or all of the List during working hours;
d) The company shall enable
the persons mentioned in Point c of this Clause to access, examine, and copy
the List of related persons of the company and other contents in the most
convenient manner; must not obstruct them to exercise such right. Procedures
for examining and copying the List of related persons and related interests
shall be prescribed by the company’s charter.
5. Members of the Board of
Directors, the Director/General Director that shall explain the nature and
contents of the works they carry out single-handedly or on behalf of other
persons to the Board of Directors and the Control Board. Such works may only be
carried out when it is approved by a majority of other members of the Board of
Directors; if the work is carried out without notification or approval by the
Board of Directors, all incomes from such work shall belong to the company.
Article
160. Responsibilities of the company’s managers
1. Members of the Board of
Directors, Director/General Director, and other managers have the
responsibilities to:
a) Perform given rights and
obligations in accordance with this Law, relevant regulations of law, the
company’s charter, and Resolutions of the General Meeting of Shareholders;
b) Perform given rights and
obligations in a truthful, careful manner to ensure the company’s legitimate
interests;
c) Act in the best interest of
the company and shareholders; do not use information, secrets, business opportunities
of the company; do not misuse the position, power, or assets of the company for
self-seeking purposes or serving the interest of other entities;
d) Promptly, and accurately
notify the company of the enterprises they and their related persons own or
have the controlling stakes or shares; such notifications shall be posted at
the company’s headquarter and branches.
2. Perform other rights and
obligations prescribed in this Law and the company’s charter.
Article
161. Rights to file lawsuit against Members of the Board of Directors,
Director/General Director
1. The shareholder or group of
shareholders that continuously holds at least 1% of ordinary shares for 06
months is entitled to, whether single-handedly or on behalf of the company,
file civil lawsuits against a Member of the Board of Directors or the
Director/General Director if he/she:
a) commit violations against
obligations of the company’s manager prescribed in Article 160 of this Law;
b) fails to perform given
rights and obligations; fails to implement or to completely implement
Resolutions of the Board of Directors;
c) Perform given rights and
obligations against the law, the company’s charter, or Resolutions of the
General Meeting of Shareholders;
d) uses information, secrets,
business opportunities of the company for self-seeking purposes or serving the
interest of other entities;
dd) abuses the position,
power, or assets of the company for self-seeking purposes or serving the
interest of other entities;
e) Other cases prescribed by
law and the company’s charter.
2. Procedures for proceedings
are prescribed by corresponding regulations of law on civil proceedings. The
proceeding costs in case the shareholder or group of shareholders files a
lawsuit on behalf of the company shall be included in the company’s expense,
unless such lawsuit is rejected.
Article
162. Contracts and transactions subject to approval by the General Meeting of
Shareholders or the Board of Directors
1. Contracts and transactions
between the company and the following entities are subject to approval by the
General Meeting of Shareholders or the Board of Directors:
a) Shareholders and authorized
representative of shareholders that own more than 10% of ordinary shares of the
company and their related persons;
b) Members of the Board of
Directors, the Director/General Director, and their related persons;
c) The enterprises mentioned
in Clause 2 Article 159 of this Law.
2. The Board of Directors must
approve every contract and transaction smaller than 35% of the enterprise’s total
asset value written in the latest financial statement, or a smaller rate
prescribed by the company’s charter. In this case, the person that signs the
contract on behalf of the company shall send a notification to Members of the
Board of Directors and Controllers of the entities related to such contract or
transaction, and enclose with the notification the draft contract or
description of the transaction. The Board of Directors shall decide whether to
approve the contract or transaction within 15 days from the day on which the
notification is received, unless another time limit is prescribed by the
company’s charter; members with related interests do not have voting right.
3. The General Meeting of
Shareholders shall approve contracts and transactions other than those
prescribed in Clause 2 of this Article. In this case, the person that
signs the contract on behalf of the company shall send a notification to the
Board of Directors and Controllers of the entities related to such contract or
transaction, and enclose with the notification the draft contract or
description of the transaction. The Board of Directors shall submit the
drat contract or description of the transaction to the General Meeting of
Shareholders or carry out a absentee voting. In this case, shareholders with
relevant interests do not have the voting right; the contract or transaction
shall be accepted when it is vote for by a number of shareholders that
represents 65% of the remaining votes, unless otherwise prescribed by the
company’s charter.
4. A contract or transaction
shall be annulled and dealt with in accordance with law when it is concluded or
carried out without approval as prescribed in Clause 2 and Clause 3 of this
Article and thus causes damage to the company; the person that concludes the
contract, related shareholders, Members of the Board of Directors, the
Director/General Director are jointly responsible for paying compensation and
return the incomes derived from such contract or transaction to the company.
Article
163. Control Board
1. The Control Board consists
of 03 – 05 members, a Controller has a term of office of up to 05 years without
term limit.
2. Controllers shall elect one
of them as the Chief of the Control Board under the majority rule. Rights and
obligations of the Chief of the Control Board shall be prescribed by the
company’s charter. More than half of members of the Control Board must reside
in Vietnam. The Chief of the Control Board must be a professional accountant or
auditor and has to work full-time at the company, unless higher standards
prescribed by the company’s charter.
3. If term of office of all
Controllers expires at the same time and Controllers of the new term are not
elected, the Controllers shall keep performing their rights and obligations
until Controllers of a new term are elected and take over the office.
Article
164. Standards and conditions of Controllers
1. A Controller must:
a) be legally competent and
not be banned from business administration and enterprise establishment as
prescribed by this Law;
b) not be a spouse, birth
parent, adoptive parent, birth child, adopted child, or sibling of any member
of the Board of Directors, Director/General Director, or any other manager;
c) not hold managerial
positions of the company. The Controller is not necessarily a shareholder or
employee of the company, unless otherwise prescribed by the company’s charter;
d) satisfy other standards and
conditions of relevant regulations of law and the company’s charter.
2. Controllers of listed
joint-stock companies and companies of which over 50% of charter capital is
held by the State must be auditors or accountants.
Article
165. Rights and obligations of the Control Board
The Control Board shall:
1. Supervise the Board of
Directors, Director, or General Director managing and running the company.
2. Inspect the rationality,
legitimacy, truthfulness, and prudence in business administration; the
systematicness, consistency, and conformability of accounting works,
statistical works, and the compilation of financial statements.
3. Inspect the sufficiency,
legitimacy, and truthfulness of business outcome reports, annual and biannual
financial statements of the company, management assessment report of the Board
of Directors, and submit the inspection report at the annual general meeting.
4. Review, check, assess the
effect and effectiveness of the internal control system, internal audit system,
risk management and early warning system of the company.
5. Examine accounting books,
accounting records and other documents of the company; managerial and
administrative works of the company where necessary or under Resolutions of the
General Meeting of Shareholders or at the request of the shareholder or group
of shareholders prescribed in Clause 2 Article 114 of this Law.
6. Carry out an inspection at
the request of the shareholder or group of shareholders mentioned in Clause 2
Article 114 of this Law within 07 working days from the day on which the
request is received. Within 15 days from the end of the inspection, the Control
Board shall report the issues that need inspecting to the Board of Directors
and the shareholder or group of shareholders that made the request.
The inspection mentioned in
this Clause must not obstruct the normal operation of the Board of Directors
and must not interrupt the company’s business administration.
7. Propose changes,
improvements to the organizational structure, mechanism for managing,
supervising, and running the company’s operation to the Board of Directors or
the General Meeting of Shareholders.
8. Notify the Board of
Directors in writing if any Members of the Board of Directors, the Director or
General Director violates Article 160 of this Law; request the violator to stop
the violation and take remedial measures.
9. Attend and discuss at meetings
of the Board of Directors, General Meetings of Shareholders, and other meetings
of the company.
10. Employ independent
consultants and internal audit department of the company to perform given
duties.
11. Seek opinions of the Board
of Directors before submitting reports, conclusions, and proposals to the
General Meeting of Shareholders.
12. Perform other rights and
obligations prescribed in this Law, the company’s charter, and Resolutions of
the General Meeting of Shareholders.
Article
166. Right to obtain information of the Control Board
1. Invitations, absentee
ballots, and enclosed documents shall be sent to the Controllers at the same
time and in the same manner as Members of the Board of Directors.
2. Resolutions and minutes of
meetings of the Board of Directors and General Meetings of Shareholders shall
be sent to the Controllers at the same time and in the same manner as
shareholders and Members of the Board of Directors.
3. Reports of the
Director/General Director submitted to the Board of Directors and other
documents issued by the company shall be sent to the Controllers at the same
time and in the same manner as Members of the Board of Directors.
4. Controllers are entitled to
access documents of the company which are kept at the headquarter, branches,
and other locations; entitled to enter working places of managers and employees
of the company during working hours.
5. The Board of Directors,
members of the Board of Directors, the Director/General Director, and other
managers must provide sufficient, accurate, and timely information, documents
about the management of the company at the request of members of the Control
Board or the Control Board.
Article
167. Salaries and other benefits of Controllers
Unless otherwise prescribed by
the company’s charter, salaries and other benefits of Controllers shall be as
follows:
1. Controllers shall receive
salaries and other benefits under decisions of the General Meeting of
Shareholders. The General Meeting of Shareholders shall decide the total salary
and annual budget of the Control Board;
2. Controllers shall have the
reasonable cost of accommodation, meals, traveling, and independent consultancy
services covered. The total salary and cost must not exceed the annual budget
of the Control Board, which is approved by the General Meeting of Shareholders,
unless otherwise decided by the General Meeting of Shareholders;
3. Salaries and expense of the
Control Board shall be included in the company’s operating cost in accordance
with regulations of law on corporate income tax, relevant regulations of law,
and shall be recorded as a separate item in the company’s financial statement.
Article
168. Responsibilities of Controllers
1. Comply with law, the
company’s charter, Resolutions of the General Meeting of Shareholders, and
professional ethics while performing their rights and obligations.
2. Perform the given rights
and obligations in a truthful, careful manner to ensure the company’s
legitimate interests;
3. Act in the best interest of
the company and its shareholders; do not use information, secrets, business
opportunities of the company; do not misuse the position, power, or assets of
the company for self-seeking purposes or serving the interest of other
entities;
4. Perform other rights and
obligations prescribed in this Law and the company’s charter.
5. The Controller that
violates regulations in Clauses 1, 2, 3, and 4 of this Article and thus causes
damage to the company or other persons shall take personal responsibility or
pay compensation for such damage. All incomes and other interests of such
Controller shall be returned to the company.
6. If a Controller is found
committing violations while performing his/her given rights and obligations,
the Board of Directors shall send a written notification to the Control Board,
request the violator to stop the violations and take remedial measures.
Article
169. Dismissal and discharge from duty of Controllers
1. A Controller shall be
dismissed if he or she:
a) no longer satisfies the
standards and conditions prescribed in Article 164 of this Law;
b) fails to perform his/her
rights and obligations for 06 consecutive months, except for force majeure
events;
c) tenders a resignation which
is accepted;
d) Other cases prescribed by
the company’s charter.
2. A Controller shall be
discharge from duty if he or she:
a) fails to fulfill the given
tasks or duties;
b) Commit serious or repeated
violations against obligations of Controllers prescribed by this Law and the
company’s charter;
c) is discharge under a
decision of the General Meeting of Shareholders.
Article
170. Submission of annual reports
1. At the end of the fiscal
year, the Board of Directors shall prepare the following reports and documents:
a) The report on the company’s
business outcome;
b) The financial statement;
c) The report on assessment of
management of the company.
2. With regard to joint-stock
companies required by law to be audited, their annual financial statements must
be audited before being submitted to the General Meeting of Shareholders for
consideration and ratification.
3. The reports and documents
mentioned in Clause 1 of this Article must be sent to the Control Board for
verification at least 30 days before the opening date of the General Meeting of
Shareholders, unless otherwise prescribed by the company’s charter.
4. The reports and documents
shall be prepared by the Board of Directors; the verification reports of the
Control Board and audit reports shall be kept at the company’s headquarter and
branches at least 10 days before the opening date of the General Meeting of
Shareholders, unless a longer period is prescribed by the company’s charter.
Any shareholder that
continuously holds the company’s shares for at least 01 year is entitled to,
whether single-handedly or together with qualified lawyers, accountants, and
auditors examine the reports mentioned in this Article at reasonable times.
Article
171. Disclosure of information about joint-stock companies
1. Every joint-stock company
shall send the annual financial statement ratified by the General Meeting of
Shareholders to a competent authority in accordance with regulations of law on
accounting and relevant regulations of law.
2. The joint-stock company
shall post the following information on its website (if any):
a) The company’s charter;
b) Résumés, qualifications,
and professional experience of members of the Board of Directors, Controllers,
the Director/General Director of the company.
c) Annual financial statements
ratified by the General Meeting of Shareholders;
d) Reports on annual business
outcome made by the Board of Directors and the Control Board.
3. Any unlisted joint-stock
company shall notify the business registration authority where the company’s
headquarter is stated of the information or changes of information about the
full names, nationalities, passport numbers, permanent residences, amount of
shares and types of shares held by foreign shareholders, names, enterprise ID
numbers, headquarter addresses, amount of shares and type of shares of
shareholders being foreign organizations, full names, nationalities, passport
numbers, permanent residences of authorized representatives of such
organizations.
4. Public companies shall
disclose information in accordance with regulations of law on securities. Every
joint-stock company over 50% charter capital of which is held by the State
shall disclose information in accordance with Article 108 and Article 109 of
this Law.
Chapter VI
PARTNERSHIP
Article
172. Partnership
1. A partnership means an
enterprise of which:
a) At least 02 partners are
co-owner of the company who run business together in a common name (hereinafter
referred to as general partner). Apart from general partners, the company may
have contributing partners;
b) General partners are
individuals who are responsible for the company’s obligations with all of their
property;
c) Contributing partners are
only liable for the company’s debts up to the value of capital contributed to
the company.
2. A partnership has its own
legal status from the issuance date of the Certificate of Business
registration.
3. Partnerships must not issue
any kind of shares.
Article
173. Contributing capital and issuing certificate of capital contribution
1. General partners and
contributing partners shall fully and punctually contribute capital as committed.
2. The general partner who
fails to fully and punctually contribute capital as committed shall pay
compensation for any damage to the company.
3. If a contributing partner
fails to fully and punctually contribute capital as committed, the deficit of capital
is considered that partner’s debt to the company; in this case such
contributing partner may be removed from the company under a decision of the
Board of partners.
4. As soon as capital is fully
contributed, the partner shall be issued with the certificate of capital
contribution. The certificate of capital contribution must contain the
following information:
a) The enterprise’s name,
enterprise identification number, address of the headquarter;
b) The company’s charter
capital;
c) Full name, permanent
residence, nationality, ID/passport number of every partner; types of partners;
d) Value of stake and type of
assets contributed as capital by partners;
dd) Numbers and dates of issue
of certificates of capital contribution;
e) Rights and obligations of
holders of certificates of capital contribution;
g) Full names, signatures of
holders of certificates of capital contribution and general partners.
5. If the certificate of
capital contribution is lost or damaged or otherwise destroyed, the partner
shall have it reissued by the company.
Article
174. Assets of a partnership
Assets of a partnership
include:
1. Contributed assets the
ownership of which have been transferred to the company by members;
2. Created assets bearing the
company’s name;
3. Assets derived from
business activities carried out by general partners on behalf of the company
and from the business activities single-handedly carried out by general
partners;
4. Other assets prescribed by
law.
Article
175. Restrictions on general partners
1. A general partner must not
own a sole proprietorship or hold the position of general partner of another
partnership, unless otherwise agreed by other general partners.
2. General partners must not
do the same business lines of the company, whether single-handedly or on behalf
of another person, for self-seeking purposes or serving the interest of other
entities;
3. A general partner must
transfer part of or all of his/her stake to another person, unless otherwise
agreed by other general partners.
Article
176. Rights and obligations of general partners
1. Every general partner is
entitled to:
a) Attend meetings, discuss,
and vote on the company’s issues; each general partner has a vote (or a number
of vote prescribed by the company’s charter);
b) Do the business lines of
the company in the name of the company; negotiate, conclude contracts and
agreements with the terms and conditions that are considered by the general
partner most beneficial to the company;
c) Use the company’s seal and
assets to do the company’s business lines. Any general partner who advances
his/her own money to do the company’s business is entitled to request the
company to return the money, including both principal and interest at the
market rate;
d) Request the company to
compensate for the damage caused by the business operation if such damage is
not at the partner’s fault;
dd) Request the company or
other general partner to provide information about the company’s performance;
inspect the assets, accounting books, and other documents where necessary;
e) Receive distributed profits
in proportion to the capital contribution or under agreement according to the
company’s charter;
g) Receive part of remaining
assets in proportion to their stake holding in case the company is dissolved or
bankrupt, unless a specific ration is prescribed by the company’s charter;
h) If a general partner dies,
his/her inheritor shall receive the value of the company’s assets minus (-) the
debts owed by such partner. The inheritor may become a general partner if accepted
by the Board of partners;
i) Perform other rights
prescribed in this Law and the company’s charter.
2. General partners have
responsibilities to:
a) Manage and run the business
in a truthful, careful manner to ensure the company’s legitimate interests;
b) Manage and run the
company’s business in accordance with law, the company’s charter, Resolutions
of the Board of Partners; pay compensation for damage caused by failure to
comply with regulations in this Point;
c) not use the company’s
assets for self-seeking purposes or serving the interest of other entities;
d) Return the money, assets
received, and pay compensation for damage to the company caused by receipt of
money or assets from the company’s business operation instead of giving it to
the company, whether single-handedly, on behalf of the company, or on behalf of
other persons;
dd) Take joint responsibility
for paying the remaining debts of the company if the company’s assets are not
sufficient to pay all its debts;
e) Bear a loss in proportion
to their stakes in the company or under an agreement according to the company’s
charter in case the company suffers a loss;
g) Submit truthful and
accurate monthly reports on his/her own performance; provide information about
his/her owner performance to other partners at their request;
h) Perform other duties
prescribed by this Law and the company’s charter.
Article
177. The Board of Partners
1. The Board of partners
consists of all partners The Board of partners shall elect a general partner as
the Chairperson of the Board of partner, who concurrently holds the position of
Director/General Director of the company, unless otherwise prescribed by the
company’s charter.
2. General partners are
entitled to request a meeting of the Board of partners to discuss and decide
the company’s business. The requesting partner shall prepare the meeting agenda
and documents.
3. The Board of partners are
entitled to decide every company’s business. Unless otherwise prescribed by the
company’s charter, the following issues must be approved by at least three
fourths (3/4) of general partners:
a) The company’s development
orientation;
b) Amendments to the company’s
charter;
c) Admission of a new general
partner;
d) Approval for a withdrawal
or removal of general partner from the company;
dd) Decision on a project of
investment;
e) Decision to take loans and
raise capital in other manners; give a loan with a value of ≥ 50% charter
capital of the company, unless a higher rate is prescribed by the company’s
charter;
g) Decision to buy, sell
assets with a value of ≥ the company’s charter capital, unless a higher rate is
prescribed by the company’s charter;
h) Decision to ratify annual
financial statement, total profit, distributable profit, and amount of profit
distributed to each;
i) Decision to dissolve the
company.
4. Decide any issue that is
not mentioned in Clause 3 of this Article if the decision is approved by at
least two thirds of general partners; the specific ration shall be prescribed
by the company’s charter.
5. The right to vote of
contributing partners shall comply with this Law and the company’s charter.
Article
178. Convening meetings of Board of partners
1. The Chairperson of the
Board of partners may convene a meeting of the Board of partners whenever it is
deemed necessary or at the request of general partners. If the Chairperson of
the Board of partners fails to convene a meeting at the request of a general
partner, such partner shall convene the meeting.
2. The invitation to the
meeting may be made in writing, by phone, fax, or another electronic medium.
The invitation must specify the purposes, requirements, contents, agenda,
location of the meeting, and name of the partner that request the meeting.
Documents serving discussion
of the issues mentioned in Clause 3 Article 177 of this Law must be sent in
advance to all partners by the deadline prescribed by the company’s charter.
3. The Chairperson of the
Board of convening partner shall chair the meeting. Every meeting of the Board
of partners must be recorded into the minutes. The minutes must contain:
a) The enterprise’s name,
enterprise identification number, address of the headquarter;
b) Purposes, agenda, and
contents of the meeting;
c) Time and location of the
meeting;
d) Full names of the chair and
attending partners;
dd) Opinions of attending
partners;
e) The Resolutions ratified,
number of partners that cast affirmative votes, and basic contents of such
Resolutions;
g) Full names and signatures
of attending partners.
Article
179. Running a partnership’s business
1. General partners are
entitled to act as the company’s legal representatives and run the company’s
everyday business. All restrictions on general partners’ running the company’s
everyday business are only effective to a third party if such person knows such
restrictions.
2. While running the company’s
business, general partners shall hold various positions of managers and
controllers.
When some or all general
partners doe certain business works, decisions shall be ratified under the
majority rule.
The company is not responsible
for any work done by a general partner beyond the company’s scope of business,
unless such work is accepted by other partners.
3. The company may open one or
some bank accounts. The Board of partners shall authorize a partner to deposit
and withdraw money from such accounts.
4. The Chairperson of the
Board of partners, the Director/General Director has the duties:
a) Run the company’s everyday
business as general partners;
b) Convene and organize
meetings of the Board of partners; sign Resolutions of the Board of partners;
c) Give tasks and cooperate
with other general partners in doing business;
d) Arrange and keep accounting
books, invoices, and other documents of the company in accordance with law;
dd) Represent the company in
the relationship with regulatory bodies; represent the company as defendant or
plaintiff in lawsuits, commercial disputes, or other disputes;
e) Perform other duties
prescribed by the company’s charter.
Article
180. Termination of general partner’s status
1. The general partner’s
status shall be terminated if the general partner:
a) Voluntarily withdraws
capital from the company;
b) Dies, is declared missing,
or legally
incompetent by the court;
c) Is removed from the
company;
d) Other cases prescribed by
the company’s charter.
2. A general partner is
entitled to withdraw capital from the company if the withdrawal is accepted by
the Board of partners. In this case, the partner that wishes to withdraw
capital shall submit a notification at least 06 months before the withdrawal
date and may only withdraw capital at the end of the fiscal year and after the
financial statement of such fiscal year is ratified.
3. A general partner shall be
removed from the company if such partner:
a) is not able to contribute
capital or fails to contribute capital as committed after the company has made
the second request;
b) commit violations against
Article 175 of this Law;
c) fails to run the business
in a truthful and prudent manner; commit inappropriate acts that cause serious
damage to the interests of the company and other partners;
d) fails to fulfill duties of
a general partner.
4. When the partner’s status of a general
partner who is legally incompetent is terminated, such partner’s stake shall be
returned fairly and reasonably.
5. Within 02 years from the
date of status termination prescribed in Point a and Point c Clause 1 of this
Article, that person is still jointly responsible for the company's debts
incurred before the date of status termination with all of his/her property.
6. After the general partner’s
status is terminated, if the name of such partner is used as part of or all of
the company’s name, the partner or his/her inheritor or legal representative is
entitled to request the company to stop using such name.
Article
181. Admission of new general partners
1. The company may admit new
general partners or contributing partners; the admission of a new partner is
subject to approval by the Board of partners.
2. General partners or
contributing partners shall fully contribute capital to the company as promised
within 15 days from the approval date, unless another time limit is decided by
the Board of partners.
3. The new general partner
shall take joint responsibility for the companies’ debts and liabilities with
all of his/her property, unless otherwise agreed between such partner and other
partners.
Article
182. Rights and obligations of contributing partners
1. Contributing partners are
entitled to:
a) Attend meetings, discuss
and vote at the Board of partners on amendments to the company’s charter,
adjustments to rights and obligations of contributing partner, restructuring or
dissolution of the company, and other contents of the company’s charter that
directly affect their rights and obligations;
b) Receive annual distributed
profits in proportion to the ratio of capital contribution to the company’s
charter capital;
c) Be provided with the
company’s annual financial statements; request the Chairperson of the Board of
partners and general partners to provide sufficient and accurate information
about the company’s performance; examine accounting books, records, contracts,
transactions and other documents of the company;
d) Transfer their stakes to
other persons;
dd) Do the company’s business
lines, whether single-handedly or on behalf of other persons;
e) Settle their stakes by
bequeathing, giving, mortgaging, pawning or in other manners in accordance with
law and the company’s charter; in case a contributing partner dies, his/her
inheritor shall become the company’s contributing partner;
g) Receive part of remaining
assets according to the proportion of their stakes to the company’s charter
capital in case the company is dissolved or bankrupt;
h) Exercise other rights
prescribed in this Law and the company’s charter.
2. Contributing partners are
obliged to:
a) Take liability for the
company’s debts and other liabilities up to the value of promised capital
contribution;
b) Not participate in business
administration, not do business on behalf of the company;
c) Comply with the company’s
charter, rules and regulations, and decisions of the Board of partners;
d) Perform other duties
prescribed by this Law and the company’s charter.
Chapter
VII
SOLE PROPRIETORSHIPS
Article
183. Sole proprietorships
1. A sole proprietorship is a enterprise
owned by an individual who is responsible for its operation with all of his/her
property.
2. Sole proprietorships must
not issue any kind of shares.
3. Each individual may
establish only one sole proprietorship. The owner of a sole proprietorship must
not concurrently be a household business owner or partner of a partnership.
4. Sole proprietorships must
not contribute capital to establishment, buy shares or stakes in partnerships,
limited liability companies, or joint-stock companies.
Article
184. Owner’s capital
1. Capital of owner of a sole
proprietorship is registered by the owner himself/herself. The sole
proprietorship owner must register the exact amount of capital in VND, a
convertible currency, gold, or other assets; if capital is in the form of other
assets, the type, quantity, and remaining value of each type of assets must be
specified.
2. All capital and assets,
including loan capital and leased assets used for the company’s business
operation, must be recorded in the company’s accounting books and financial
statements as prescribed by law.
3. During the operation, the
owner of the sole proprietorship may increase or increase his/her capital
investment in the company’s business operation. The increase or decrease in the
owner’s capital must be recorded in accounting books. If the decreased capital
falls below the registered capital, the owner may only decrease capital after
registering with the business registration authority.
Article
185. Business management
1. The owner of the sole proprietorship
has the absolute discretion as to the company’s business operation, the use of
post-tax profit, and shall fulfill other financial obligations as prescribed by
law.
2. The owner may directly or
hire another person to manage the business operation. When hiring another
person as the Director, the owner is still responsible for every business
operation of the company.
3. The owner shall be the
plaintiff, defendant, or person with related rights/obligations before the
arbitral tribunal or the court in the disputes over the company.
4. The owner of the sole
proprietorship is the company’s legal representative.
Article
186. Company leasing
The owner of the sole
proprietorship is entitled to lease out his/her entire company, provided a
written notification enclosed with a notarized copy of the lease contract is
sent to the business registration authority and tax authority within 03 working
days from the day effective date of the lease contract. In this case, the sole
proprietorship’s owner is still legally responsible as the enterprise’s owner.
The rights and obligations or the owner and the lessee to the company’s
business operation shall be specified in the lease contract.
Article
187. Selling company
1. The sole proprietorship’s
owner is entitled to sell his/her company to another person.
2. After selling the company,
the sole proprietorship’s owner is still responsible for the company’s debts
and other liabilities which are incurred before the handover date, unless
otherwise agreed among the buyer, the seller, and the creditors.
3. The buyer and seller shall
comply with regulations of law on labor.
4. The buyer shall register a
change of the sole proprietorship’s owner in accordance with this Law.
Chapter
VIII
GROUPS OF COMPANIES
Article
188. Business corporations, general companies
1. Business corporations and
general companies of various economic sectors are groups of companies that are
related to each other through ownership of shares, stakes, or other kinds of
connection. A business corporation or a general company is not a type of
business entity, does not have a legal status, and is not required to apply for
establishment registration as prescribed by this Law.
2. A business corporation or
general company has a parent company, subsidiaries, and other affiliate
companies The parent company, subsidiaries, and each of the associate companies
of a business corporation or general companies have rights and obligations of
independent enterprises as prescribed by law.
Article
189. Parent company and subsidiaries
1. A company is considered
parent company of another company if the former company:
a) Owns more than 50% of
charter capital or total ordinary shares of the other company;
b) Is entitle to directly or
indirectly decide the designation of a majority of or all of Members of the
Board of Directors, the Director/General Director of the other company;
c) Is entitled to decide
amendments to the other company’s charter.
2. Subsidiaries must not
contribute capital to or buy shares of the parent company. Subsidiaries of the
same parent company must not contribute capital or buy shares of each other for
the purpose of cross ownership.
3. Subsidiaries of the same
parent company which has at least 65% state capital must not contribute capital
to establish an enterprise as prescribed in this Law.
4. The Government shall
elaborate Clause 2 and Clause 3 of this Article.
Article
190. Rights and obligations of parent company to subsidiaries
1. Depending on the type of
business of the subsidiary, the parent company shall perform its rights and
obligations as a member/partner, owner, or shareholder of the subsidiary in
accordance with corresponding regulations of this Law and relevant regulations
of law.
2. The contracts,
transactions, and other relationships between the parent company and the
subsidiary must the established and executed independently and equitably under
conditions applied to independent legal entities.
3. If the parent company makes
intervention beyond the competence of the owner, member/partner, or shareholder
and requires the subsidiary to do business against usual practice or engage in
unprofitable activities without providing acceptable compensation in the fiscal
year and, the parent company shall be responsibility for any damage to the
subsidiary.
4. The manager of the parent
company shall take responsibility for the intervention mentioned in Clause 3 of
this Article and, together with the parent company, take joint responsibility
for the damage.
5. If the parent company fails
to provide compensation for the subsidiary as prescribed in Clause 3 of this
Article, the creditor, member/partner, or shareholder that holds at least 1% of
charter capital of the subsidiary is entitled to, whether single-handedly or on
behalf of the subsidiary, request the parent company to pay compensation for
the subsidiary.
6. If the business activities
of a subsidiary mentioned in Clause 3 of this Article bring profits for another
subsidiary of the same parent company, the subsidiary that receives such profit
shall, together with the parent company, return the profit to the subsidiary
that suffers the loss.
Article
191. Financial statements of parent company and subsidiaries
1. At the end of the fiscal
years, apart from the reports and documents prescribed by law, the parent company
shall make the following reports:
a) Consolidated financial
statement of the parent company in accordance with regulations of law on
accounting;
b) The report on summary of
annual business outcome of the parent company and subsidiaries;
c) The report on summary of
management and administration of the parent company and subsidiaries.
2. The persons in charge of
making the reports mentioned in Clause 1 of this Article shall not make and
submit such reports before receiving all financial statements of subsidiaries.
3. At the request of legal
representative of the parent company, the legal representative of the
subsidiary shall provide necessary reports, documents, and information as
prescribed to make the consolidated financial statement and summary report of
the parent company and subsidiaries.
4. The parent company’s
manager shall use such reports to make the consolidated financial statement and
summary report of the parent company and subsidiaries if the reports made and
submitted by subsidiaries are not suspected to be contain incorrect,
inaccurate, or false information.
5. In case the parent
company’s manager does not receive necessary reports, documents, and
information from a subsidiary after taking all necessary measures within
his/her competence, the parent company’s manager shall still make and submit
the consolidated financial statement and summary report of the parent company
and subsidiaries. The report might or might not contain information from such
subsidiary, but explanation must be provided to avoid misunderstanding.
6. Reports, annual financial
statements of the parent company, subsidiaries, consolidated financial
statements, and summary reports of the parent company and subsidiaries must be
kept at the parent company’s headquarter. Copies of the reports and documents
in this Clause must be available of the parent company’s branches in Vietnam’s
territory.
7. Subsidiaries must make
summary reports on purchase, sale, and other transactions with the parent
company in addition to the reports and documents prescribed by law.
Chapter
IX
RESTRUCTURING, DISSOLUTION, AND
BANKRUPTCY OF ENTERPRISES
Article
192. Total division
1. A limited liability company
or joint-stock company may divide shareholders/members, and assets of the
company (hereinafter referred to as transferor company) to establish two new
companies or more (hereinafter referred to as transferee company) in one of the
following cases:
a) Part of stakes/shares of
members/shareholders and an amount of assets proportional to the value of stakes/shares
are transferred to the transferee companies according to their holding in the
transferor company and corresponding to the value of assets transferred to the
transferee companies;
b) All of stakes/shares of one
or some members/shareholders and an amount of assets proportional to the value
of stakes/shares are transferred to the transferee enterprises;
c) A combination of both cases in Point a and
Point b of this Clause.
2. Procedures for total
division of a limited liability company or joint-stock company:
a) The Board of members, the
owner, or the General Meeting of Shareholders of the transferor company shall
ratify the Resolution on total division in accordance with this Law and the
company’s charter. The Resolution on total division must contain basic
information including the transferor company’s name, headquarter addresses,
names of transferee companies; rules, method, and procedures for asset
division; employment plan; method, time limit, and procedures for transferring
the transferor company’s stakes, shares, bonds to transferee companies; rules
for fulfillment of the transferor company’s obligations; time limit for
division. The Resolution on total division shall be sent to all creditors and
notified to all employees within 15 days from the ratification date;
b) Members, the owner, or
shareholders of each of the transferee companies shall ratify its charter,
elect or designate the Chairperson of the Board of members, the company's
President, the Board of Directors, Director/General Director, and apply for
business registration in accordance with this Law. In this case, the
application for enterprise registration of the transferee companies must be
enclosed with the Resolution on total division mentioned in Point a of this
Clause.
3. The number of members,
shareholders, their holding of stakes/shares, quantity of shareholders and
charter capital of the transferee companies are corresponding to the method of
dividing, transferring stakes/shares of the transferor company to the
transferee companies in the cases mentioned in Clause 1 of this Article.
4. The transferor company
shall cease to exist after the transferee companies are issued with their
Certificates of Business registration. Transferee companies are jointly
responsible for the unpaid debts, employment contracts, and other liabilities
of the transferor company, or reach agreements with the creditors, customers,
and employees to decide on one of the companies to settle such obligations.
5. The business registration
authority shall update the legal status of the transferor company on the
National Business Registration Database when issuing Certificates of Business
registration to transferee companies. If the transferee company’s headquarter
is outside the province in which the transferor company’s headquarter is
situated, the business registration authority of the province in which the
transferee company’s headquarter is situated shall notify the business
registration of the transferee company to the business registration authority
of the province in which the transferor company’s headquarter is situated in
order to update the legal status of the transferor company on National
Enterprise Registration Database.
Article
193. Partial division
1. A limited liability company
or joint-stock company may be partially divided by transferring part of its
existing assets, rights and obligations (hereinafter referred to as transferor
company) to establish one or some new limited liability companies or
joint-stock companies (hereinafter referred to as transferee companies) without
terminating the existence of the transferor company.
2. Partial division may be
carried out using one of the following methods:
a) Part of stakes/shares of
members/shareholders and an amount of assets proportional to the value of stakes/shares
are transferred to the transferee companies according to their holding in the
transferor company and corresponding to the value of assets transferred to the
transferee companies;
b) All of stakes/shares of one
or some members/shareholders and an amount of assets proportional to the value
of their stakes/shares are transferred to the transferee companies;
c) A combination of both cases
in Point a and Point b of this Clause.
3. The transferor company
shall register a change to charter capital and number of members, which are
proportional to the decrease in stakes/shares and quantity of members, at the
same time with business registration of transferee companies.
4. Procedures for partial
division of a limited liability company or a joint-stock company:
a) The Board of members, the
owner, or the General Meeting of Shareholders of the transferor company shall
ratify the Resolution on partial division in accordance with this Law and the
company’s charter. The Resolution on partial division must contain basic
information including the transferor company’s name, headquarter addresses,
names of transferee companies; employment plan; division method; value of
assets, rights and obligations transferred from the transferor company to the
transferee companies; time limit for division. The Resolution on partial
division shall be sent to all creditors and notified to all employees within 15
days from the ratification date;
b) Members, the owner, or
shareholders of each of the transferee companies shall ratify its charter,
elect or designate Chairpersons of the Board of members, the company's
President, the Board of Directors, Director/General Director, and apply for
business registration in accordance with this Law. In this case, the
application for enterprise registration must be enclosed with the Resolution on
partial division mentioned in Point a of this Clause.
5. After business
registration, the transferor company and transferee companies are jointly
responsible for the unpaid debts, employment contracts, and other liabilities
of the transferor company, unless otherwise agreed among the transferor
company, transferee companies, the transferor company’s creditors, customers,
and employees.
Article
194. Corporate amalgamation
1. Two or some companies
(hereinafter referred to as consolidating companies) may consolidate into a new
company (hereinafter referred to as consolidated company). After that,
consolidating companies shall cease to exist.
2. Procedures for
consolidation:
a) The consolidating companies
prepare the consolidation contract. The consolidation contract must contain the
consolidating companies’ names, headquarter addresses; the consolidated
company’s name and headquarter address; procedures and conditions for
consolidation; employment plan; time limit and procedures for transferring
assets, stakes, shares, bonds of the consolidating companies to the
consolidated company; time limit for consolidation; draft charter of the
consolidated company;
b) Members, the owner, or
shareholders of the consolidating companies shall ratify the consolidation
contract, the consolidated company’s charter, elect or designate Chairpersons
of the Board of members, the company's President, the Board of Directors,
Director/General Director of the consolidated company, and apply for business
registration in accordance with this Law. The consolidation contract
shall be sent to all creditors and notified to all employees within 15 days
from the ratification date;
3. If the consolidated company
has 30% - 50% of the market share, legal representatives of consolidating
companies shall notify the competition authority before initiating the
consolidation process, unless otherwise prescribed by the Law on Competition.
Consolidation is prohibited if
the consolidated company has more than 50% of the market share after
consolidation, unless otherwise prescribed by the Law on Competition.
4. Documents and procedures
for registration of the consolidated company shall comply with this Law. Copies
of the following documents shall be enclosed:
a) The consolidation contract;
b) The Resolutions and meeting
minutes that ratify the consolidation contract of the consolidating companies.
5. After business
registration, the consolidating companies shall cease to exist; the
consolidated company shall inherit the lawful rights and interests as well as
unpaid debts, employment contract, and other liabilities of the consolidating
companies.
6. The business registration
authority shall update the legal status of the consolidating companies on the
National Business Registration Database when issuing the Certificate of
Business registration to the consolidated company. If the new company’s
headquarter is outside the province in which the divided company’s headquarter
is situated, the business registration authority of the province in which the
new company’s headquarter is situated shall notify the business registration of
the new company to the business registration authority of the province in which
the divided company’s headquarter is situated in order to update the legal
status of the divided company on National Enterprise Registration Database.
Article
195. Acquisition
1. One or some companies
(hereinafter referred to as acquired companies) may be merged into another
company (hereinafter referred to as the acquirer) by transferring all assets,
legitimate rights, obligations, and interests to the acquirer. After that, the
acquired companies shall cease to exist.
2. Procedures for acquisition:
a) Relevant companies shall
prepare the acquisition contract and draft the charter of the acquirer. The
acquisition contract must contain the acquirer’s names, headquarter addresses;
the acquired company’s name and headquarter address; procedures and conditions
for acquisition; employment plan; time limit and procedures for transferring
assets, stakes, shares, bonds of the consolidating companies to the acquirer;
time limit for acquisition;
b) Members, the owners, or
shareholders of each of relevant companies shall ratify the acquisition
contract, charter of the acquirer, and apply for registration of the acquirer
as prescribed by this Law. The acquisition contract shall be sent to all
creditors and notified to all employees within 15 days from the ratification
date;
c) After business
registration, the acquired companies shall cease to exist; the acquirer shall
inherit the lawful rights and interests as well as unpaid debts, employment
contract, and other liabilities of the acquired companies.
3. If the acquirer has 30% -
50% of the market share, legal representatives of the companies shall notify
the competition authority before initiating the acquisition process, unless
otherwise prescribed by the Law on competition.
Acquisition is prohibited if
the acquirer has more than 50% of the market share after acquisition, unless
otherwise prescribed by the Law on Competition.
4. Documents and procedures
for registration of the acquirer shall comply with this Law. Copies of the
following documents shall be enclosed:
a) The acquisition contract;
b) The Resolutions and meeting
minutes that ratify the acquisition contract of the acquirer.
c) The Resolution and meeting
minutes that ratify the acquisition contract of the acquired companies, unless
the acquirer is a member/partner or shareholder that holds more than 65% of
charter capital or voting shares of the acquired company.
5. The business registration
authority shall update the legal status of the acquired companies on the
National Business Registration Database and adjust the Certificate of Business
registration of the acquirer.
If the headquarter of an
acquired company is outside the province in which the acquirer’s headquarter is
situated, the business registration authority of the province in which the
acquirer’s headquarter is situated shall notify the business registration authority
of the province in which the acquired company’s headquarter is situated in
order to update the legal status of the acquired company on National Enterprise
Registration Database.
Article
196. Converting a limited liability company into a joint-stock company
1. When a state-owned company
is converted into a joint-stock company, regulations of law on conversion of
state-owned companies into joint-stock companies shall apply.
2. A limited liability company
may be converted into a joint-stock company in one of the following manners:
a) Conversion into a
joint-stock company without raising capital from other entities, without
selling stakes to other entities;
b) Conversion into a
joint-stock company by raising capital from other entities;
c) Conversion into a joint-stock
company by selling part of or all of the stakes to one or some other entities;
d) Combination of the methods
in Points a, b, and c of this Clause.
3. The company shall register
the conversion with a business registration authority within 10 days from the
day on which the conversion is completed. Within 05 working days from the
receipt of the application, the business registration authority shall reissue
the Certificate of Business registration.
4. The converted company
obviously inherits all of the lawful rights and interests, debts including tax
debts, employment contracts, and other obligations of the old company.
5. Within 07 working days from
the day on which the Certificate of Business registration is issued, the
business registration authority shall notify relevant regulatory bodies as
prescribed in Clause 1 Article 34 of this Law, and update the company’s legal
status on the National Business Registration Database.
Article
197. Converting a joint-stock company into a single-member limited liability
company
1. A joint-stock company may
be converted into a single-member limited liability company in one of the
following manners:
a) A shareholder receives the
transfer of all shares and stakes of all other shareholders;
b) A organization or individual
other than a shareholder receives the transfer of all shares of all of the
company’s shareholders;
c) The company has only one
shareholder for a period of time exceeding the time limit prescribed in Article
110 of this Law.
2. The transfer or receipt of
capital in the form of shares or stakes mentioned in Clause 1 of this Article
shall comply with market prices. Prices are determined according to the asset
method, discounted cash flow method, or other methods.
3. Within 15 days from the
completion of share transfer prescribed in Point a and Point b Clause 1 of this
Article, if the event mentioned in Point c Clause 1 of this Article occurs, the
company shall send or submit the application for conversion to the business
registration authority where the enterprise registered. Within 05 working days
from the receipt of the application, the business registration authority shall
issue the Certificate of Business registration.
4. The converted company
obviously inherits all of the lawful rights and interests, debts including tax
debts, employment contracts, and other obligations of the old company.
5. Within 07 working days from
the day on which the Certificate of Business registration is issued, the
business registration authority shall notify relevant regulatory bodies as
prescribed in Clause 1 Article 34 of this Law, and update the company’s legal
status on the National Business Registration Database.
Article
198. Converting a joint-stock company into a multi-member limited liability
company
1. A joint-stock company may
be converted into a multi-member limited liability company in one of the
following manners:
a) Conversion into a limited
liability company without raising additional capital or transferring shares to
other entities;
b) Conversion into a limited
liability company together with raising capital from other entities;
c) Conversion into a limited
liability company together with transferring part of or all of shares to other
organizations and individuals that contribute capital;
d) Combination of the methods
in Points a, b, and c of this Clause.
2. The company shall register
the conversion with a business registration authority within 10 days from the
day on which the conversion is completed. Within 05 working days from the
receipt of the application, the business registration authority shall issue the
Certificate of Business registration.
3. The converted company
obviously inherits all of the lawful rights and interests, debts including tax
debts, employment contracts, and other obligations of the old company.
4. Within 07 working days from
the day on which the Certificate of Business registration is issued, the
business registration authority shall notify relevant regulatory bodies as
prescribed in Clause 1 Article 34 of this Law, and update the company’s legal
status on the National Business Registration Database.
Article
199. Converting a sole proprietorship into a limited liability company
1. A sole proprietorship may
be converted into a limited liability company under a decision of the sole
proprietorship’s owner if all of the following conditions are satisfied:
a) All conditions in Clause 1
Article 28 of this Law are satisfied;
b) The sole proprietorship’s
owner is the owner (if the sole proprietorship is converted into single-member
limited liability company under the ownership of an individual) or member (if
the sole proprietorship is converted into a multi-member limited liability
company) of the limited liability company;
c) The sole proprietorship’s
owner makes a written commitment to take personal responsibility for all unpaid
debts of the sole proprietorship with all of his/her property and to settle the
debts when they are due;
d) The sole proprietorship’s
owner has a written agreement with parties of unfinished contracts that the new
limited liability company will take over such contracts;
dd) The sole proprietorship’s
owner makes a written commitment or agreement with other capital contributors
to employ the existing employees of the sole proprietorship.
2. Within 05 working days from
the receipt of the application, the business registration authority shall
consider issuing the Certificate of Business registration if all of the
conditions in Clause 1 of this Article are satisfied.
3. Within 07 working days from
the day on which the Certificate of Business registration is issued as
prescribed in Clause 2 of this Article, the business registration authority
shall notify relevant regulatory bodies as prescribed in Clause 1 Article 34 of
this Law, and update the company’s legal status on the National Business
Registration Database.
Article
200. Enterprise suspension
1. A enterprise may suspend
its business as long as a written notification of the time and duration of
suspension and time of resumption is sent to the business registration
authority at least 15 days before the date of suspension or resumption. This
regulation still applies in case the enterprise resumes its business before the
notified date.
2. The business registration
authority or competent authority shall request an enterprise to suspends the
business lines subject to conditions if such conditions are not satisfied by
the enterprise.
3. During the suspension
period, the enterprise shall pay outstanding tax, keep paying its debts,
executing contracts with customers and employers, unless otherwise agreed among
the enterprise, its creditors, customers, and employees.
Article
201. Cases of and conditions for dissolution
1. A enterprise shall be
dissolved in the following cases:
a) The operation period
written in the company’s charter expires without a decision on extension;
b) The dissolution is decided
by the owner of the sole proprietorship, by all general partners of the
partnership, by the Board of members or owner of the limited liability company,
or insurance the General Meeting of Shareholders of the joint-stock company;
c) The company fails to
maintain the minimum number of members prescribed by this Law for 06
consecutive months without following procedures for
business conversion;
d) The Certificate of Business
registration is revoked.
2. The enterprise shall only
be dissolved if all debts and liabilities can be settled and the enterprise is
involved in any dispute at a court or arbitral tribunal. Relevant managers and
enterprises mentioned in Point d Clause 1 of this Article are jointly
responsible for the enterprise’s debts.
Article
202. Procedures for enterprise dissolution
The dissolution in the cases
mentioned in Points a, b, and c Clause 1 Article 201 of this Law shall be
carried out as follows:
1. Ratify the decision on dissolution.
The decision on dissolution must contain:
a) The enterprise’s name and
headquarter address;
b) Reasons for dissolution;
c) Procedures for finalizing
contracts and settling debts of the enterprise; the deadline for settling debts
and finalizing contracts must not exceed 06 months from the day on which the
decision on dissolution is ratified;
b) Plans for settlement of
obligations derived from employment contracts;
dd) Full name and signature of
the enterprise's legal representative.
2. Sole proprietorship’s
owner, the Board of members, owner, or the Board of Directors shall directly
organize the enterprise’s asset liquidation, unless a separate liquidation
organization must be established according to the company’s charter.
3. Within 07 working days from
the approval date, the decision on dissolution meeting minutes must be sent to
the business registration authority, tax authority, and employees of the
enterprise; the decision on dissolution shall be posted on National Business
Registration Portal, the enterprise’s headquarter, branches, and representative
offices.
If there are unsettled
financial obligations, the decision on dissolution shall be enclosed with the
debt settlement plan and sent to the creditors, people with relevant rights,
obligations, and interests. The plan must contain the creditors’ names and
addresses; the amount of debts, deadline, location, and method of payment;
method and deadline for settlement of creditors’ complaints.
4. The business registration
authority shall post a notification of the status of every enterprise
undergoing dissolution process on the National Business Registration Portal
right after receiving the decision on dissolution from the enterprise. The
notification must be posted together with the decision on dissolution and debt
settlement plan (if any).
5. The enterprise’s debts
shall be paid in the following order:
a) Unpaid salaries, severance
pay, social insurance as prescribed by law, other benefits of employees
according to collective bargaining agreement and signed employment contracts;
b) Tax debts;
c) Other debts.
6. After all debts and
dissolution costs are paid, the remaining value shall be received by the sole
proprietorship’s owner, members, shareholders, or owner of the company
according to their holding of stakes or shares in the company.
7. The legal representative of
the enterprise shall send the petition for dissolution to the business
registration authority within 05 working days from the day on which all of the
enterprise’s debts are settled.
8. The business registration
authority shall update the enterprise’s legal status of National Enterprise
Registration Database if no opinions or objections from relevant parties are
received after 180 days from the day on which the decision on dissolution is
receipt as prescribed in Clause 3 of this Article or within 05 working days
from the receipt of the petition for dissolution.
9. Government shall elaborate
the procedures for business dissolution.
Article
203. Enterprise dissolution upon revocation of Certificate of Business
registration or under a Court’s decision
The enterprise dissolution
mentioned in Point d Clause 1 Article 201 of this Law shall be carried out
following the procedures below:
1. The business registration
authority shall post a notification of the status of the enterprise undergoing
dissolution process on the National Business Registration Portal concurrently
with issuing a decision to revoke the Certificate of Business registration or
as soon as receiving an effective decision on dissolution issued by a Court.
The notification shall be posted together with the Court’s decision to revoke
the Certificate of Business registration;
2. Within 10 days from the
receipt of the decision to revoke the Certificate of Business registration or
from the effective date of the Court’s decision, the enterprise shall convene a
meeting to decide the dissolution. The decision on dissolution and copy of the
decision to revoke the Certificate of Business registration or the effective
Court’s decision shall be sent to the business registration authority, tax
authority, and employees of the enterprise, and be posted at the enterprise’s
headquarter and branches. If required by law, the decision shall be posted on
at least 03 consecutive issues of a conventional newspaper or online
newspapers.
If there are unsettled
financial obligations, the decision on dissolution shall be enclosed with the
debt settlement plan and sent to the creditors, people with relevant rights,
obligations, and interests. The plan must contain the creditors’ names and
addresses; the amount of debts, deadline, location, and method of payment;
method and deadline for settlement of creditors’ complaints.
3. The enterprise’s debts
shall be paid in accordance with Clause 5 Article 202 of this Law.
4. The legal representative of
the enterprise shall send the petition for dissolution to the business
registration authority within 05 working days from the day on which all of the
enterprise’s debts are settled.
5. The business registration
authority shall update the enterprise’s legal status of National Enterprise
Registration Database if no opinions or objections from relevant parties are
received after 180 days from the notification date prescribed in Clause 1 of
this Article or within 05 working days from the receipt of the petition for
dissolution.
6. The company manager is
personally responsible for the damage cause by failure to comply with or to
completely comply with regulations of this Article.
Article
204. Petition for enterprise dissolution
1. The petition for
dissolution include the following documents:
a) A notification of the
enterprise dissolution;
b) A report on liquidation of
the enterprise’s assets; a list of creditors and paid debts, including tax
debts, outstanding social insurance contributions, and debts owed to employees
after deciding the dissolution (if any);
c) The seal and seal
certificate (if any);
d) The Certificate of Business
registration.
2. Members of the Board of
Directors of the joint-stock company, members of the Board of members of the
limited liability company, the company’s owner, the sole proprietorship’s
owner, the Director/General Director, general partners, legal representative of
the enterprise shall be responsible for the truthfulness and accuracy of the
petition.
3. If the petition are not
accurate or fraudulent, the persons mentioned in Clause 2 of this Article are
jointly responsible for paying the unpaid debts, taxes, and unsettled
employees’ benefits, and take personal responsibility for any consequence that ensue
within 05 years from the day on which petition for dissolution is submitted to
the business registration authority.
Article
205. Banned activities as from issuance of decision on dissolution
1. From the issuance of the
decision on dissolution, the enterprise and its manager are prohibited to:
a) Hide, illegally liquidate
assets;
b) Renounce or reduce the
right to claim debts;
c) Convert unsecured debts
into debts secured on the enterprise’s assets;
d) Sign new contracts, except
for those serving the enterprise’s dissolution;
dd) Mortgage, pledge, give,
lease out assets;
e) Terminate effective
contracts;
g) Raise capital in any shape
or form.
2. Depending on the nature and
seriousness violations, the individual that commits the violations in Clause 1
of this Article shall face administrative violations or criminal prosecution,
and pay compensation for any damage caused.
Article
206. Shut down of branches and representative offices
1. A branch or representative
office of an enterprise shall be terminated under a decision of the enterprise
or a decision to revoke the Certificate of registration of branch or
representative office issued by a competent authority
2. Documents for Shut down of
a branch or representative office includes:
a) The decision of the enterprise
to shut down the branch or representative office, or the decision to revoke the
Certificate of registration of branch or representative office issued by a
competent authority;
b) The list of creditors and
outstanding debts, including tax debts, of the branch and outstanding social
insurance contributions;
c) The list of employees and
their corresponding benefits;
d) The Certificate of
registration of the branch or representative office;
dd) The seal of the branch or
representative office (if any).
3. The enterprise’s legal
representative and the head of the shut down branch or representative office
are jointly responsible for the truthfulness and accuracy of the said
documents.
4. The enterprise whose branch
is shut down is responsible for execution of contracts, payment of debts,
including tax debts, of the branch, keep employing the branch’s employees or
provide them with adequate benefits.
5. Within 05 working days from
the receipt of sufficient documents prescribed in Clause 2 of this Article, the
business registration authority shall update the legal status of the branch or
representative office on National Enterprise Registration Database.
Article
207. Bankruptcy
Regulations of law on
bankruptcy shall apply to bankruptcy of enterprises.
Chapter
X
IMPLEMENTATION
Article
208. Responsibilities of regulatory bodies
1. The Government shall unify
state management of enterprises.
2. Ministers and ministerial
agencies are responsible to the government for fulfillment of their duties with
regard to state management of enterprises.
3. Ministers and ministerial
agencies, within the scope of their competence, shall direct professional
organizations to periodically send the following information to the business
registration authorities where the enterprises’ headquarters are situated:
a) Information about Business
licenses, Certificates of eligibility for business operation, practicing
certificates, certifications or written approval for business conditions issued
to enterprises, decisions on penalties for administrative violations committed
by enterprises;
b) Information about the
operation and tax payment of enterprises derived from enterprises’ tax reports;
c) Information about
enterprises’ operation serving improvement of state management effect.
4. The People’s Committees of provinces shall
manage local enterprises.
5. The People’s Committees of provinces,
within the scope of their competence, shall direct affiliated professional
organizations and the People’s Committees of districts to periodically send the
information prescribed in Clause 2 of this Article to the business registration
authorities where the enterprises’ headquarters are situated.
6. The Government shall
elaborate this Article.
Article
209. Business registration authorities
1. Every business registration
authority has the following duties and entitlements:
a) Process business
registration applications and issue Certificates of Business registration as
prescribed by law;
b) Cooperate in developing and
managing the National Business Registration Information System; provide
information for regulatory bodies, organizations and individuals at their
request as prescribed by law;
c) Request enterprises to
report their conformity to this Law where necessary; urge enterprises to
report.
d) Carry out inspections or
request competent authorities to carry out inspections according to contents of
applications for enterprise registration;
dd) Take responsibility for
the validity of applications for enterprise registration; Take no
responsibility for violations committed by enterprises before and after
business registration;
e) Deal with violations
against regulations on business registration prescribed by law; revoke
Certificates of Business registration and request enterprise to follow
procedures for dissolution in accordance with this Law;
g) Perform other rights and
obligations prescribed by this Law and relevant laws.
2. The Government shall
provide for organization structure of business registration authorities.
Article
210. Actions against violations
1. Any organization or
individual that commit violations against this Law, depending on the nature and
seriousness of the violations, shall face disciplinary actions, administrative
penalties, and pay compensation for any damage caused; individuals might also
face criminal prosecution as prescribed by law.
2. The Government shall
elaborate penalties for administrative violations against this Law.
Article
211. Revocation of Certificate of Business registration
1. A enterprise shall have its
Certificate of Business registration revoked in the following cases:
a) The information provided in
the application for enterprise registration is false;
b) The enterprise is
established by persons banned from enterprise establishment as prescribed in
Clause 2 Article 18 of this Law;
c) The enterprise’s business
operation is suspended for 01 year without notifying the business registration
authority and tax authority;
d) The enterprise fails to
submit reports as prescribed in Point c Clause 1 Article 209 of this Law to the
business registration authority within 06 months from the deadline or from the
receipt of a written request;
dd) Other cases decided by the
Court.
2. The Government shall
elaborate procedures for revocation of the Certificate of Business
registration.
Article
212. Effect
1. This Law takes effect from
July 01, 2015. The Law on Enterprises No. 60/2005/QH11 dated November 29, 2005
and the Law No. 37/2013/QH13 dated June 20, 2013 on Amendments to Article 170
of the Law on Enterprise are null and void from the effective date of this Law,
except for the following cases:
a) With regard to limited
liability companies established before this Law takes effect, the company’s
charter shall apply to deadlines for capital contribution;
b) Enterprises of which
charter capital is held by the State shall be restructured to ensure conformity
with Clause 2 and Clause 3 Article 189 of this Law before July 01, 2017;
c) Clause 2 Article 189 shall
not apply to companies whose shares or stakes are held by the State before July
01, 2015, provided the ratio of cross ownership is not increased.
2. Every household business
that hires 10 regular employees or more must apply for business registration in
accordance with this Law. Small-scale household businesses shall apply for
business registration and operate in accordance with regulations of the
Government.
3. Pursuant to this Law, the
Government shall elaborate the organizational structure and operation of
state-owned companies directly serving national defense and security or
combining business operation with national defense and security.
Article
213. Specific regulations
The Government shall elaborate
the Articles and Clauses as mentioned above.
This Law is passed by the 13th
National Assembly of Socialist Republic of Vietnam during the 8th
session on November 26, 2014.
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PRESIDENT OF NATIONAL ASSEMBLY
Nguyen Sinh Hung
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