How is the payment for shares registered to buy when registering to establish a business?

If shareholders do not contribute enough charter capital, can the payment intermediary service company continue to operate?

1. How is the payment for shares registered to buy when registering to establish a business?

According to Article 113 of the Law on Enterprises 2020, the payment for shares registered to buy when registering to establish a business is regulated as follows:

1. Shareholders must pay in full for the number of shares registered to purchase within 90 days from the date of issuance of the Business Registration Certificate, unless the company charter or the share purchase registration contract stipulates a shorter period. In case a shareholder contributes capital with assets, the time for importing and carrying out administrative procedures to transfer ownership of that asset is not included in this capital contribution period. The Board of Directors is responsible for supervising and urging shareholders to pay in full and on time for shares registered to buy.

(..)

3. In case after the deadline specified in Clause 1 of this Article, the shareholder has not paid or can only pay a part of the shares registered to buy, the following regulations shall apply:

a) Shareholders who have not paid for the shares registered to buy are automatically no longer shareholders of the company and may not transfer the right to buy those shares to others;

b) Shareholders who only pay part of the shares registered to buy have the right to vote, receive dividends and other rights corresponding to the number of shares paid; The right to buy unpaid shares is not allowed to be transferred to another person;

c) Unpaid shares are considered unsold shares and the Board of Directors has the right to sell;

d) Within 30 days from the end of the period to fully pay for the number of shares registered to buy according to the provisions of Clause 1 of this Article, the company must register to adjust its charter capital equal to the par value of the shares that have been paid in full, unless the unpaid shares have been sold within this period; Register to change founding shareholders.

(…)

Thus, in case shareholders do not fully contribute charter capital within 90 days from the date of issuance of the Business Registration Certificate, the company will have to register to adjust charter capital equal to the par value of the fully paid shares.

2. How are the conditions for providing payment intermediary services regulated?

According to Clause 2, Article 15 of Decree 101/2012/ND-CP, amended by Clause 8, Article 1, Decree 80/2016/ND-CP, Article 3, Decree 16/2019/ND-CP, the conditions for providing intermediary services are: Payment includes:

a) Having an establishment license or business registration certificate issued by a competent state authority;

b) Having a plan to provide payment intermediary services approved by a competent authority according to the provisions of the organization’s Charter, which must at least contain the following contents:

(i) Technical professional process of the service Licensing request, including: Name, scope of supply, customers, conditions of use, diagram and explanation of operational steps, cash flow process from transaction initiation to settlement of obligations between related parties;

(ii) Solvency assurance mechanism, including: Mechanism to open and maintain payment assurance account balance, purpose of using payment assurance account accounting;

(iii) Internal inspection and control process; risk management, ensuring safety and security; General principles and internal regulations on money laundering prevention and combat; process and procedures for resolving inquiries, complaints, and disputes;

c) Have a minimum charter capital of 50 billion VND;

d) Personnel conditions: The legal representative, General Director (Director) of the organization requesting the license must have a university degree or higher or have at least 03 years of direct work in one of the fields of business administration, economics, finance, banking, law;

Deputy General Director (Deputy Director) and key officials implementing the Project to provide payment intermediary services (including Head of department (department) or equivalent and technical staff) have a college degree or higher in one of the fields of economics, finance, banking, information technology or specialized field in charge;

d) Technical conditions: Have physical facilities, technical infrastructure, information technology systems, and technological solutions suitable to the requirements of payment intermediary service provision activities; Backup technical system built independently from the main system to ensure safe and continuous service provision when the main system has a problem and comply with other regulations on ensuring safety and security of information technology systems in banking operations;

e) For financial switching services and electronic clearing services, the service provider must have an organization settle the clearing results between related parties;

g) For payment support services for customers with accounts at multiple banks, the service provider must connect with an organization providing financial switching services and electronic clearing services licensed by the State Bank to perform switching and clearing of obligations arising during the process of providing payment intermediary services of the organization.

Thus, the condition to provide payment intermediary services is to have a minimum charter capital of 50 billion VND.

3. Will shareholders not contributing enough charter capital affect the License to provide intermediary payment services?

According to Point a, Clause 4, Article 16 of Decree 101/2012/ND-CP, the License to provide intermediary payment services is revoked and the provision of payment intermediary services must be terminated in one of the following cases:

Within 6 months from the date of issuance of the License, that organization does not carry out the provision of licensed payment intermediary services without a legitimate reason; within 3 months from the date the State Bank issues a written notice to the organization that it violates one of the conditions specified in Clause 2, Article 15 of this Decree and must take corrective measures but the organization cannot fix it; The organization is dissolved or goes bankrupt according to relevant laws.

Thus, if shareholders do not contribute capital on time, causing the company to change its charter capital and not meet the condition of minimum charter capital of VND 50 billion, the company may have its license to provide intermediary payment services revoked and must terminate its operations.