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Legal representatives of a company in Vietnam

The legal representative of an enterprise is an individual representing the enterprise to exercise rights and obligations arising from transactions of the enterprise, representing the enterprise in the capacity of a requester for settlement of civil matters, plaintiffs, defendants, persons with related interests and obligations before arbitration, courts and other rights and obligations as prescribed by law.

The number of legal representatives of a company in Vietnam

Limited liability companies and joint stock companies may have one or more legal representatives. The company’s charter specifies the number and management titles and rights and obligations of the legal representative of the enterprise. If the company has more than one legal representative, the company’s charter specifies the rights and obligations of each legal representative.

In case the division of rights and obligations of each legal representative has not yet been clearly stated in the company’s charter, each legal representative of the company is a competent representative of the enterprise before the party; all legal representatives must be jointly responsible for damage caused to the enterprise in accordance with the provisions of the civil law and other relevant laws.

Conditions of the legal representative of a company in Vietnam

The legal representative of the company can be the legal representative of many different enterprises. However, there are 02 cases where the following legal representative will not continue to be the legal representative of the company:

  • The representative of the company whose tax identification number is suspended, i.e. in the course of operation, the enterprise does not report tax, does not fulfill its tax obligations, the enterprise does not operate but does not carry out the procedures for notification of temporary cessation of operation with the business registration authority and abandon the enterprise.
  • According to regulations on public company governance, there are limitations: The Chairman of the Board of Directors cannot concurrently hold the position of Director (General Director) as the representative of the same public company.

Residence of the legal representatives of a company in Vietnam

The enterprise must ensure that there is always at least one legal representative residing in Vietnam. When there is only one legal representative remaining in Vietnam, this person, upon exiting Vietnam, must authorize in writing another individual residing in Vietnam to exercise the rights and perform the obligations of the legal representative. In this case, the legal representative is still responsible for the performance of the authorized rights and obligations.

Time limit for authorization of the legal representatives of a company in Vietnam

In case the time limit for authorization as prescribed above expires but the legal representative of the enterprise has not returned to Vietnam and does not have another authorization, the following provisions shall be followed:

  • The authorized person continues to exercise the rights and obligations of the legal representative of the private enterprise until the legal representative of the enterprise returns to work at the enterprise;
  • The authorized person continues to exercise the rights and perform the obligations of the legal representative of the limited liability company, joint-stock company or partnership until the legal representative of the company back to work at the company or until the company owner, the Members’ Council, the Board of Directors decide to appoint another person to act as the legal representative of the enterprise.
  • Except for the case of the company’s legal representative dead, missing, being examined for penal liability, being held in custody, or serving administrative handling measures at the compulsory detoxification, compulsory education institution, fleeing from residence, restricted or incapacitated civil acts, difficulties in cognition, behavior control, bans from holding certain posts by the Court, prohibited from practicing certain professions or doing certain jobs. In this case, there is only one legal representative who is absent from Vietnam for more than 30 days without authorizing another person to perform the rights and obligations of the legal representative or also fall into the above-mentioned situation, the company owner, the Members’ Council and the Board of Directors appoint another person to act as the company’s legal representative.
  • For a limited liability company with two members, if any member who is an individual as the legal representative of the company dies, is missing, is being examined for penal liability, is in custody, is serving serving a prison sentence, serving an administrative handling measure at a compulsory detoxification establishment, a compulsory education institution, fleeing the place of residence, having limited or incapacitated civil act capacity, having difficulties in the awareness, control of behavior, banned by the Court from holding certain positions, practicing certain professions or doing certain jobs, the remaining members will automatically act as the legal representatives of the company until other decision is made of the Members’ Council on the legal representative of the company.
  • Courts and other competent procedure-conducting agencies have the right to appoint legal representatives to participate in the proceedings in accordance with law.

Responsibilities of the legal representative of the enterprise

The legal representative of the enterprise has the following responsibilities:

  • To perform the assigned rights and obligations honestly, carefully and in the best way to ensure the legitimate interests of the enterprise;
  • Loyal to the interests of the enterprise; not abuse their position and position and use information, know-how, business opportunities and other assets of the enterprise for personal gain or to serve the interests of other organizations or individuals;
  • To promptly, fully and accurately notify the enterprise of the enterprise of which he or his related persons own or have shares or contributed capital in accordance with the Law on Enterprises.
  • The legal representative of the enterprise is personally liable for damage to the enterprise due to the violation of the above-mentioned responsibilities.

If you have any difficulties or questions related to the company’s operations, you need to consult the internal issues of the business, please contact Viet An Law for support.

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