Handling arbitrarily transferring capital contributions to others without selling to the remaining members in a 2-member limited liability company?

Handling the case of arbitrarily transferring capital contributions to others without offering to sell to the remaining members in a 2-member LLC?

Mr. A and Mr. B are members of a 2-member LLC established in 2019 2020. In 2022, Mr. A transferred his capital contribution to Ms. C, but did not let Mr. B know. In case Mr. B sues Mr. A, will the Court determine that Ms. C is a member of the Company? How to handle the legal consequences of the capital transfer contract between Mr. A and Ms. C? This is a question from Mr. A.G from Can Tho.

According to Article 52 of the Law on Enterprises 2020, it is stipulated:

Transfer of capital contribution

1. Except for the cases specified in Clause 4, Article 51, Clause 6 and Clause 7, Article 53 of this Law, members of a limited liability company with two or more members have the right to transfer part or all of their capital contribution to others according to the following provisions:

a) Offer to sell that capital contribution to the remaining members in proportion to their capital contribution in the company with the same offering conditions sell;

b) Transfer with the same offering conditions for the remaining members specified in point a of this clause to non-members if the remaining members of the company do not buy or do not buy all within 30 days from the date of offering.

2. The transferring member still has rights and obligations towards the company corresponding to the relevant capital contribution until information about the buyer specified in Points b, c and dd, Clause 2, Article 48 of this Law is fully recorded in the member registration book.

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Based on the above regulations, the fact that Mr. A arbitrarily transferred his capital contribution to Ms.

Accordingly, Ms. C must return the capital contribution transferred from Mr. A; Ms. C does not become a member of the Company.

The legal consequences of an invalid contract will comply with the provisions of Article 131 of the 2015 Civil Code as follows:

Legal consequences of invalid civil transactions

1. Invalid civil transactions do not create, change or terminate the civil rights and obligations of the parties from the time the transaction is established.

2. When a civil transaction is invalid, the parties restore the original state and return to each other what they have received.

In cases where it cannot be returned in kind, the value will be returned in cash.

3. The bona fide party in collecting profits and interests does not have to return those profits and interests.

4. The party at fault for causing damage must compensate.

5. The resolution of the consequences of invalid civil transactions related to moral rights is regulated by this Code and other relevant laws.

If transferring or changing the capital contributions of members of a 2-member LLC results in only one member remaining, can the company convert to the form of a private enterprise?

Transfer or change the capital contributions of members of a LLC 2 members lead to only one member remaining, can the company convert to a private enterprise, then based on Clause 3, Article 51 of the 2020 Enterprise Law:

When transferring or changing the capital contributions of members of a 2-member LLC resulting in only one member remaining, the company cannot convert to the form of a private enterprise but must convert to a single-member LLC and register to change the content of the business registration within 15 days from the date of completion of the transfer.

The registration book of members of a 2-member LLC can show the capital contribution of each member. members?

According to Clause 2, Article 48 of the 2020 Enterprise Law as follows:Member registration book

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2. The member registration book must include the following main contents:

a) Name, business code, company headquarters address;

b) Full name, contact address, nationality, legal document number of the individual for individual members; name, business code or legal document number of the organization, head office address for members who are organizations;

c) Capital contribution, proportion of capital contributed, time of capital contribution, type of contributed assets, quantity, value of each type of contributed assets of each member;

d) Signature of individual members, legal representative of organizational members; organization;

d) Number and date of issuance of certificate of capital contribution of each member.

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Accordingly, the registration book of members of a 2-member limited liability company shows the contents specified in Clause 2 above, including the content of capital contribution, proportion of contributed capital, time of capital contribution, type of capital contribution assets, quantity and value of each type of capital contribution asset of each member.