Lawyer's Advice

No.

Content

Law Enterprise in 2014

Law Enterprise in 2020

Key changes

1.               

Seals

·   An enterprise is entitled to decide the form, quantity, and contents of its seal but must ensure that the name and code of the enterprise must be present.

·   Before using the seal, the enterprise must send the seal design to the business registration authority in order to post it on the National Business Registration Portal.

·   The management, use, and retention of the seal shall comply with the company’s charter.

·   The seal shall be used in the cases prescribed by law or agreed by the parties.

·   The enterprise’s seals can be physical or digital as prescribed by e-transaction laws.

·   The enterprise shall decide the type, quantity, design, and content of its seal and the seals of its branches, representative offices and other units.

·   The management and storage of seals shall comply with the company's charter and regulations of the enterprise.

·   Seals shall be used by enterprises in transactions as prescribed by law.

·   Allows use of seals in the form of digital signatures.

·   Remove the requirement before using the seal, the enterprise must announce the seal sample for public posting on the National Portal.

2.               

Legal representative of enterprises

Limited liability companies and joint stock companies may have one or more legal representatives. The company's charter specifies the number, managerial position and rights and obligations of the enterprise's legal representative.

Limited liability companies and joint stock companies may have one or more legal representatives. The company's charter specifies the number, managerial position and rights and obligations of the enterprise's legal representative. If the company has more than one legal representative, the company's charter specifies rights and obligations of each legal representative. In case the division of rights and obligations of each legal representative is not specified in the company's charter, each legal representative of the company will be the authorized representative of the enterprise to the party. Tuesday; All legal representatives are jointly liable for any damage caused to the enterprise in accordance with civil law and other relevant laws.

The legal representative of enterprises

3.               

Report information change of the business manager

Enterprises must report to the business registration authority within 05 days from the date of change of information about the enterprise manager, including:

1. Member of the Board of Directors  for joint stock companies;

2. Member of Board of Controllers or Controller;

3. Director or General Director

Report information change of the business manager

4.               

The right to issue bonds of one member limited liability company.

 Single-member limited liability companies is not allowed to issue bonds.

Single-member limited liability companies may issue bonds in accordance with Law on enterprises and relevant laws.

The right to issue bonds of one member limited liability company.

5.               

The right to issue bonds of multiple-member limited liability companies.

Multiple-member limited liability companies is not allowed to issue bonds.

Multiple-member limited liability companies may issue bonds in accordance with Law on enterprises and relevant laws

The right to issue bonds of multiple-member limited liability companies.

6.               

Board of Controllers of multiple-member limited liability companies

A limited liability company with 11 or more members must have a Board of Controllers

A state-owned multiple-member limited liability company and each subsidiary company of a state-owned enterprise shall have a Board of Controllers. The establishment of the Board of Controllers in other companies shall be decided by themselves.

Board of Controllers of multiple-member limited liability companies

7.               

Meeting minutes of one member of limited liability companies and multiple-member limited liability companies

Supplementing the provision that in case the chair and the minute taker refuse to sign the minutes, they will be effective if they are signed by the other members of the Board of Members and contain all information prescribed by laws. The minutes shall clearly state the reasons why the chair and the minute taker refuse to sign them. The persons who sign the minutes are jointly responsible for the accuracy and truthfulness of the minutes.

Meeting minutes of one member of limited liability companies and multiple-member limited liability companies

8.               

Major shareholder

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).

The shareholder or group of shareholders that holds at least 5% of the ordinary shares (or a smaller ratio specified in the company's charter).

Major shareholder

9.               

Deadline for the annual GMS

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 GMS shall be convened within 04 months from the end of the fiscal year. Unless otherwise prescribed by the company's charter, the Board of Directors shall decide deferral of the annual GMS where necessary by up to 06 months from the end of the fiscal year.

Deadline for the annual GMS

10.            

Members of Board of Directors

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.

The term of office of a member of the Board of Directors shall not exceed 05 years without term limit. An individual may only be elected independent member of the Board of Directors of a company for up to 02 continuous terms.

Members of Board of Directors

11.            

Minutes of meetings of the Board of Directors

Don’t have this regulation in Law on Enterprise in 2014

In case the Chair or the secretary refuses to sign the minutes, they will be effective if they are signed by all other members of the Board of Directors and contain all information prescribed by laws.

Minutes of meetings of the Board of Directors

12.            

Type of contract, the transaction must be approved by the General Meeting of Shareholders

Don’t have this regulation in Law on Enterprise in 2014

The General Meeting of Shareholders shall approve: Contracts and transactions that involve borrowing, lending, selling assets that are worth more than 10% of the company’s total assets according to the latest financial statement between the company and shareholders that hold at least 51% of the total voting shares or their related persons.

Type of contract, the transaction must be approved by the General Meeting of Shareholders

13.            

Other changes of the JSC

There are some changes in the time of making the list of shareholders, the deadline for inviting the meeting of the General Meeting of Shareholders, the Board of Directors, the authorization for a representative to attend the General Meeting of Shareholders, the conditions for conducting a meeting of shareholders, conditions resolutions of the General Meeting of Shareholders are approved.

Other changes of the JSC

14.            

Enterprise suspension

An 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.

An enterprise shall send a written notification to the business registration authority at least 03 working days before the suspension or resumption date.

Enterprise suspension