Can foreigners be directors of a company in Vietnam?

Nowadays, it is gradually becoming common for a business to have a foreign director. So according to current regulations, can foreigners be directors of a company in Vietnam? Viet An Law will answer this question for you through the article below.

Legal basis

• Labor Code 2019;
• Law on Enterprise 2020;
• Decree 152/2020/ND-CP regulating foreign workers working in Vietnam and recruitment and management of Vietnamese workers working for foreign organizations and individuals in Vietnam

What is the title of the company director?

The Director or General Director is the head and directly manages the company’s daily business, is subject to the supervision of the Board of Directors, and is responsible before the Board of Directors and before the law for the implementation exercise of assigned rights and obligations.

Can foreigners be directors of a company in Vietnam?

Director is a position in an enterprise, foreigners who are directors will also be considered foreign workers. So to answer the above question, Viet An Law will analyze the following ideas:

Conditions for foreigners to work in Vietnam

Under Article 151 of the Labor Code 2019, foreign workers who want to work in Vietnam need to meet the following conditions:

• Be 18 years old or older and have full civil capacity;
• Have professional qualifications, techniques, skills, and work experience; Have good health according to the regulations of the Ministry of Health;
• Not a person who is serving a sentence or has not had a criminal record erased or is being prosecuted for criminal liability according to foreign or Vietnamese law;
• Have a work permit issued by a competent Vietnamese state agency. This condition will not apply to foreign workers in the following cases:
• Be an owner or capital-contributing member of a limited liability company with a foreign capital contribution value of 3 billion or more;
• Be the Chairman of the Board of Directors or member of the Board of Directors of a joint stock company with a foreign capital contribution value of 3 billion or more;
• Be the Head of a representative office, or project or be responsible for the activities of an international organization or foreign non-governmental organization in Vietnam;
• Enter Vietnam for less than 3 months to offer services;
• Entering Vietnam for a period of less than 03 months to handle problems, complex technical and technological situations that arise that affect or threaten to affect production and business that Vietnamese experts and Foreign investors currently in Vietnam cannot handle;
• Be a foreign lawyer who has been granted a License to practice law in Vietnam according to the provisions of the Law on Lawyers;
• In cases under the provisions of international treaties to which the Socialist Republic of Vietnam is a member ;
• Foreigners married to Vietnamese people and living in Vietnamese territory ;
• Other cases according to Government regulations.

Conditions for recruiting foreign workers to work in Vietnam

Enterprises, agencies, organizations, individuals, and contractors:

• Only recruiting foreign workers to fill management, executive, expert, and technical positions that Vietnamese workers cannot meet the needs of production and business;
• When recruiting foreign workers to work in Vietnam, it must explain the need for labor and receive written approval from a competent state agency;
• Particularly for contractors, when recruiting and using foreign workers, they must specifically declare job positions, professional and technical qualifications, work experience, and working time when using foreign workers. outside to carry out the bidding package and receive written approval from the competent state agency.

Standards and conditions to become Director or General Director

Individuals must have full civil capacity and not fall into the following categories:

• Minors; people with limited civil act capacity; people who have lost their civil act capacity; people with difficulty in cognition and behavior control; organizations without legal status;
• People who are being prosecuted for criminal liability, are detained, are serving prison sentences, are serving administrative measures at compulsory detoxification facilities, compulsory education establishments or are being banned by the Court holding positions, prohibiting practicing certain professions or doing certain jobs; Other cases according to the provisions of the Bankruptcy Law
• If requested by the Business Registration Authority, the person registering to establish a business must submit a criminal record card to the Business Registration Authority;
• Organizations are commercial legal entities banned from doing business and operating in certain fields according to the provisions of the.

In addition to the legal conditions, an individual who is a Director or General Director of a company must have professional qualifications and experience in business administration of the company and other conditions prescribed by the company’s Charter;

For types of enterprises with more than 50% state capital and subsidiaries of 100% state-owned enterprises, the Director, in addition to meeting the above two conditions, also needs to ensure that he is not a person with family relations. with the company manager, the Controller of the company and the parent company, the representative of the enterprise’s capital, and the representative of the state’s capital in the subsidiary and parent company.

Through the above analysis, it can be seen that a foreigner can be a Director of a Vietnamese company that meets all three conditions: Conditions for foreign workers to work in Vietnam, Conditions for recruiting foreign workers in Vietnam, and the Standards and conditions to become a Director and General Director that Viet An Luat has specifically analyzed above.

Can foreigners establishing a company in Vietnam hire a Vietnamese director?

If a foreigner establishes a company in Vietnam, that company will be considered a Vietnamese legal entity. Therefore, the conditions to become a Director of this company will also be governed by Vietnamese law.

In case this business wants to hire a Vietnamese director, this business will only need to meet the standards and conditions to become Director or General Director. Specifically:

• Individuals must have full civil capacity and not fall into the following categories:
• Minors; people with limited civil act capacity; people who have lost their civil act capacity; people with difficulty in cognition and behavior control; organizations without legal status;
• People who are being prosecuted for criminal liability, are detained, are serving prison sentences, are serving administrative measures at compulsory detoxification facilities, compulsory education establishments or are being banned by the Court holding positions, prohibiting practicing certain professions or doing certain jobs; Other cases according to the provisions of the Bankruptcy Law
• If requested by the Business Registration Authority, the person registering to establish a business must submit a criminal record card to the Business Registration Authority;
• Organizations are commercial legal entities banned from doing business and operating in certain fields according to the provisions of the.
• In addition to the legal conditions, an individual who is a Director or General Director of a company must have professional qualifications and experience in business administration of the company and other conditions prescribed by the company’s Charter;
• For types of enterprises with more than 50% state capital and subsidiaries of 100% state-owned enterprises, the Director, in addition to meeting the above two conditions, also needs to ensure that he is not a person with family relations. with the company manager, the Controller of the company and the parent company, the representative of the enterprise’s capital, and the representative of the state’s capital in the subsidiary and parent company.

Above is Viet An Law’s advice on conditions for foreigners to be directors of Vietnamese companies. If you have any questions about your business, please contact us for the best support!