In case of dissolution of a business, after paying all debts and remaining assets, will those assets be divided?

In case of dissolution of a business, after paying all debts and remaining assets, will those assets be divided?

1. According to the law, how are joint stock companies regulated?

In Article 111 of the Law on Enterprises 2020, joint stock companies are regulated as follows:

– A joint stock company is an enterprise, in which:

a) charter capital is divided into equal parts called shares;

b) Shareholders can be organizations or individuals; The minimum number of shareholders is 03 and there is no limit to the maximum number;

c) Shareholders are only responsible for the debts and other property obligations of the enterprise within the amount of capital contributed to the enterprise;

d) Shareholders have the right to freely transfer their shares to others, except for the cases specified in Clause 3, Article 120 and Clause 1, Article 127 of this Law.

– A joint stock company has legal status from the date of issuance of the Business Registration Certificate.

– A joint stock company has the right to issue shares, bonds and other securities of the company ty.

2. In case of dissolution of the enterprise, after paying all debts, there are remaining assets, will those assets be divided?

According to Article 119 of the Law on Enterprises 2020, shareholders’ obligations are stipulated as follows:

“Article 119. Obligations of shareholders

1. Full and timely payment of committed shares buy.

2. Do not withdraw capital contributed by common shares from the company in any form, except in the case of repurchase of shares by the company or another person. In case a shareholder withdraws part or all of the contributed capital in contravention of the provisions of this Clause, that shareholder and the person with related interests in the company must be jointly responsible for the debts and other property obligations of the company within the value of the withdrawn shares. damages occur.”

Accordingly, if this shareholder wants to withdraw from the company, he must transfer his shares to another person according to Article 127 of the Law on Enterprises 2020 is as follows:

“Article 127. Transfer of shares

1. Shares are freely transferable, except for the cases specified in Clause 3, Article 120 of this Law and the company’s charter has regulations restricting the transfer of shares. In case the company charter has regulations restricting the transfer of shares, these regulations are only applicable. effective when clearly stated in the shares of the respective shares.

2. In case of transfer by contract, the transfer documents must be signed by the transferor and the transferee or their authorized representative securities.”

Or request the company to repurchase shares according to Article 132 of the Law on Enterprises 2020:

“Article 132. Repurchase shares at the request of shareholders

1. Shareholders have voted not to approve the resolution on reorganizing the company or changing rights, Shareholders’ obligations stipulated in the Company’s Charter have the right to request the company to repurchase their shares. The request must be in writing, clearly stating the name, address of the shareholder, the number of shares of each type, the intended sale price, and the reason for requesting the company to repurchase within 10 days from the date the General Meeting of Shareholders passes the resolution on the issues specified in this clause. 

2 The company must buy back the shares at the shareholder’s request specified in Clause 1 of this Article at the market price or the price calculated according to the principles specified in the company’s Charter within 90 days from the date of receipt of the request, if the parties cannot agree on the price, the Company can request a valuation organization to introduce at least 03 valuation organizations for shareholders to choose and that choice is the final decision. 

Only one of these two forms can be applied, there is no division of assets.

3. How is the capital of a joint stock company regulated?

According to Article 112 of the Law on Enterprises 2020, the capital of a joint stock company is regulated as follows:

– The charter capital of a joint stock company is the total par value of all types of shares sold. The charter capital of a joint stock company when registering to establish a business is the total par value of all types of shares registered to buy and recorded in the company’s charter.

– Sold shares are shares with the right to be offered for sale that have been fully paid by shareholders to the company. When registering to establish a business, shares sold are the total number of shares of all types registered to buy.

– Shares authorized to be offered by a joint stock company are the total number of shares of all types that the General Meeting of Shareholders decides to offer to raise capital. The number of shares authorized to be offered by a joint stock company when registering to establish a business is the total number of shares of all types that the company will offer for sale to raise capital, including shares that have been registered to buy and shares that have not been registered to buy.

– Unsold shares are shares that have the right to be offered for sale and have not been paid to the company. When registering to establish a business, unsold shares are the total number of shares of all types that have not been registered to buy.

The company may reduce its charter capital in the following cases:

a) According to the decision of the General Meeting of Shareholders, the company refunds a portion of capital contribution to shareholders according to the proportion of their shares owned in the company if the company has operated continuously for 02 years or more from the date of business registration and ensures full payment of debts and other property obligations after repaying shareholders;

b) The company buys back sold shares according to the provisions of Article 132 and Article 133 of this Law;

c) The charter capital is not paid in full and on time by shareholders according to the provisions of Article 113 of this Law.