May the Younger Brother of a State Enterprise Director Become a Member of That Enterprise’s Members’ Council?

What is a person with a family relationship?

Pursuant to Clause 22, Article 4 of the Law on Enterprises 2020, the concept of a “person with a family relationship” is explained as follows:

“Article 4. Interpretation of terms

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22. Persons with family relationships include: husband, wife, biological father, biological mother, adoptive father, adoptive mother, father-in-law (husband’s father), mother-in-law (husband’s mother), wife’s father, wife’s mother, biological children, adopted children, son-in-law, daughter-in-law, full older brother, full older sister, full younger sibling, brother-in-law (sister’s husband), brother-in-law (younger sister’s husband), sister-in-law (older brother’s wife), sister-in-law (younger brother’s wife), wife’s full older brother, husband’s full older brother, wife’s full older sister, husband’s full older sister, wife’s full younger sibling, husband’s full younger sibling.

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Accordingly, “persons with family relationships” include: husband, wife, biological father, biological mother, adoptive father, adoptive mother, father-in-law (husband’s father), mother-in-law (husband’s mother), wife’s father, wife’s mother, biological children, adopted children, son-in-law, daughter-in-law, full older brother, full older sister, full younger sibling, brother-in-law (sister’s husband), brother-in-law (younger sister’s husband), sister-in-law (older brother’s wife), sister-in-law (younger brother’s wife), wife’s full older brother, husband’s full older brother, wife’s full older sister, husband’s full older sister, wife’s full younger sibling, husband’s full younger sibling.

What are the regulations on the Members’ Council in a state enterprise?

Pursuant to Article 91 of the Law on Enterprises 2020 on the Members’ Council in a state enterprise as follows:

“Article 91. Members’ Council

1. The Members’ Council acts in the name of the company to exercise the company’s rights and obligations under this Law and other relevant laws.

2. The Members’ Council comprises the President and other members, numbering no more than 07 persons. Members of the Members’ Council are appointed, dismissed, removed, rewarded, and disciplined by the owner representative agency.

3. The term of the President and other members of the Members’ Council is no more than 05 years. Members of the Members’ Council may be reappointed. An individual appointed as a member of the Members’ Council may not serve more than 02 terms at one company, except where they have worked continuously at that company for over 15 years before being first appointed.”

Accordingly, the Members’ Council in a state enterprise comprises the President and other members, numbering no more than 07 persons. Members of the Members’ Council are appointed, dismissed, removed, rewarded, and disciplined by the owner representative agency. The term of the President and other members of the Members’ Council is no more than 05 years. Members of the Members’ Council may be reappointed. An individual appointed as a member of the Members’ Council may not serve more than 02 terms at one company, except where they have worked continuously at that company for over 15 years before being first appointed.

How are the regulations on the rights and obligations of Members’ Council members in a state enterprise implemented?

Pursuant to Article 96 of the Law on Enterprises 2020, the rights and obligations of Members’ Council members in a state enterprise are implemented as follows:

“Article 96. Rights and obligations of Members’ Council members

1. Attend Members’ Council meetings, discuss, make recommendations, and vote on matters within the competence of the Members’ Council.

2. Inspect, review, look up, copy, and extract the books recording and monitoring contracts, transactions, accounting books, financial statements, minutes of Members’ Council meetings, and other company documents and materials.

3. Other rights and obligations under the company charter, this Law, and other relevant laws.”

Accordingly, members of the Members’ Council in a state enterprise have the following rights and obligations:

– Attend Members’ Council meetings, discuss, make recommendations, and vote on matters within the competence of the Members’ Council.

– Inspect, review, look up, copy, and extract the books recording and monitoring contracts, transactions, accounting books, financial statements, minutes of Members’ Council meetings, and other company documents and materials.

– Other rights and obligations under the company charter, this Law, and other relevant laws.

May the younger brother of a state enterprise Director become a member of that enterprise’s Members’ Council?

Pursuant to Article 93 of the Law on Enterprises 2020, the criteria and conditions for members of the Members’ Council in a state enterprise include:

– Not falling within the category prescribed in Clause 2, Article 17 of this Law.

– Having professional qualifications and experience in business administration or in the enterprise’s operating sectors, fields, or trades.

– Not being a person with a family relationship to the head or deputy head of the owner representative agency; a member of the Members’ Council; the Director, Deputy Director or General Director, Deputy General Director, and Chief Accountant of the company; or the company’s Controller.

– Not being a manager of a member enterprise.

– Except for the President of the Members’ Council, other members of the Members’ Council may concurrently serve as Director or General Director of that company or of another company that is not a member enterprise by decision of the owner representative agency.

– Never having been removed as President of the Members’ Council, member of the Members’ Council, or President of the company, Director, Deputy Director or General Director, Deputy General Director of a state enterprise.

– Other criteria and conditions prescribed in the company charter.

Thus, the younger brother of a state enterprise Director cannot become a member of that enterprise’s Members’ Council because the condition prescribed in Clause 3, Article 93 of the Law on Enterprises 2020 is not satisfied.