Must a Joint Stock Company Hold an Annual General Meeting of Shareholders?

Short answer: Yes, it is mandatory. A joint stock company must hold an annual General Meeting of Shareholders (GMS) once a year, within 04 months from the end of the fiscal year (Article 139 of the Law on Enterprises 2020). In special cases, the Board of Directors may extend the deadline, but no more than 06 months from the end of the fiscal year. Failure to hold the annual meeting is a violation and may be subject to administrative penalties.

Legal basis

• Article 139 of the Law on Enterprises 2020 — annual General Meeting of Shareholders.

Meeting deadlines

• Annual meeting once a year;
• Within 04 months from the end of the fiscal year;
• Extension of up to 06 months in necessary cases, as decided by the Board of Directors;
• In addition to the annual meeting, the company may hold extraordinary meetings when needed.

Contents of the annual meeting

• Approval of the annual financial statements;
• Approval of the business plan for the coming year;
• Election, dismissal, and removal of Board members and Controllers (when terms expire);
• Decisions on dividends and Board remuneration;
• Other matters within the authority of the GMS.

Convening procedures

• The Board of Directors convenes the meeting; notices of invitation must be sent no later than 21 days before the opening date (unless the Charter provides a longer period);
• The notice must include the meeting agenda and related documents;
• Shareholders have the right to propose additions to the agenda as prescribed.

Penalties for failure to hold the meeting

• Failure to hold the annual GMS as prescribed may be subject to administrative penalties;
• Shareholders have the right to request the Court to intervene when their right to attend the GMS is infringed;
• Key decisions (dividends, personnel…) are blocked, affecting the company’s operations.

If you need to determine the right approach for your specific situation, you should discuss it with a lawyer in advance for a review of your documents and advice on the course of action.

For quick advice, you can contact a lawyer at 0966.475.966.

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• Who has the right to appoint the director of a joint stock company?
• Rights of ordinary shareholders in a joint stock company
• If the Chairman of the Board of Directors is detained, who runs the company?