When Are Members’ Council Members of State Enterprises Dismissed or Removed?

How Is the Members’ Council of a State Enterprise Regulated?

Pursuant to Article 91 of the Law on Enterprises 2020 (as amended and supplemented by Law No. 76/2025/QH15, effective from 01/7/2025), the Members’ Council in a State Enterprise is regulated as follows:

“Article 91. Members’ Council

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

2. The Members’ Council comprises the Chairperson and other members, not exceeding 07 persons. Members of the Members’ Council are appointed, dismissed, removed, rewarded, and disciplined by the owner’s representative agency.

3. The term of the Chairperson and other members of the Members’ Council does not exceed 05 years. Members of the Members’ Council may be reappointed. An individual may be appointed as a member of the Members’ Council for no more than 02 terms at one company, except where he/she has worked continuously for over 15 years at that company before the first appointment.”

Accordingly, the Members’ Council comprises the Chairperson and other members, not exceeding 07 persons. Members of the Members’ Council are appointed, dismissed, removed, rewarded, and disciplined by the owner’s representative agency. The term of the Chairperson and other members of the Members’ Council does not exceed 05 years. Members of the Members’ Council may be reappointed. An individual may be appointed as a member of the Members’ Council for no more than 02 terms at one company.

What Are the Standards and Conditions for Members of the Members’ Council in a State Enterprise?

Pursuant to Article 93 of the Law on Enterprises 2020, the standards and conditions for members of the Members’ Council are as follows:

“Article 93. Standards and Conditions for Members of the Members’ Council

1. Not falling under the subjects prescribed in Clause 2, Article 17 of this Law.

2. Having professional qualifications and experience in business administration or in the fields, lines, or trades of the enterprise’s operations.

3. Not being a family member of the head or deputy head of the owner’s representative agency; a member of the Members’ Council; the Director, Deputy Director or General Director, Deputy General Director, or Chief Accountant of the company; or a company Controller.

4. Not being a manager of a member enterprise.

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

6. Not having previously been removed from the position of Chairperson of the Members’ Council, member of the Members’ Council, or company Chairperson, Director, Deputy Director, General Director, or Deputy General Director of a state enterprise.

7. Other standards and conditions prescribed in the company charter.”

Thus, to become a member of the Members’ Council in a State Enterprise, the following standards and conditions must be ensured:

– Not falling under cases where the law prohibits establishing an enterprise.

– Having professional qualifications and experience in business administration or in the fields, lines, or trades of the enterprise’s operations.

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

– Not being a manager of a member enterprise.

– Not having previously been removed from the position of Chairperson of the Members’ Council, member of the Members’ Council, or company Chairperson, Director, Deputy Director, General Director, or Deputy General Director of a state enterprise.

In Which Cases Are Members of the Members’ Council in a State Enterprise Dismissed or Removed?

The cases of dismissal and removal of members of the Members’ Council in a State Enterprise are prescribed in Article 94 of the Law on Enterprises 2020, specifically as follows:

“Article 94. Dismissal and Removal of Members of the Members’ Council

1. The Chairperson and other members of the Members’ Council are dismissed in the following cases:

a) No longer satisfying the standards and conditions prescribed in Article 93 of this Law;

b) Having submitted a resignation letter accepted in writing by the owner’s representative agency;

c) Being transferred, assigned other work, or retiring;

d) Lacking the capacity or qualifications to undertake the assigned work;

dd) Lacking the health or prestige to hold the position of member of the Members’ Council.

2. The Chairperson and other members of the Members’ Council are removed in the following cases:

a) The company fails to complete annual plan targets and indicators, or fails to preserve and develop invested capital as required by the owner’s representative agency, without being able to explain objective causes or with explanations not accepted by the owner’s representative agency;

b) Being convicted by the Court with a legally effective Court judgment or decision;

c) Being dishonest in exercising rights and obligations or abusing position, using the company’s assets for personal gain or to serve the interests of other organizations or individuals; dishonestly reporting the company’s financial situation and production and business results.

3. Within 60 days from the date of the decision to dismiss or remove the Chairperson and other members of the Members’ Council, the owner’s representative agency considers and decides on the selection and appointment of replacements.”

Accordingly, a member of the Members’ Council is dismissed in the following cases:

• No longer satisfying the standards and conditions prescribed by law;
• Having submitted a resignation letter accepted in writing by the owner’s representative agency;
• Being transferred, assigned other work, or retiring;
• Lacking the capacity or qualifications to undertake the assigned work;
• Lacking the health or prestige to hold the position of member of the Members’ Council.

A member of the Members’ Council is removed in the following cases:

• The company fails to complete annual plan targets and indicators, or fails to preserve and develop invested capital as required by the owner’s representative agency, without being able to explain objective causes or with explanations not accepted by the owner’s representative agency;
• Being convicted by the Court with a legally effective Court judgment or decision;
• Being dishonest in exercising rights and obligations or abusing position, using the company’s assets for personal gain or to serve the interests of other organizations or individuals; dishonestly reporting the company’s financial situation and production and business results.