Regulations on legal representatives of enterprises according to Vietnamese law

The legal representative of a business is an important subject, playing an indispensable role for each business. This article shares in detail the legal regulations for legal representatives of enterprises according to the Law on Enterprises 2020. 

CSPL:   Articles 12, 13 of the Law on Enterprises 2020

             Articles 54, 79, 137, 185, 190 Law on Enterprises 2020

1. legal representative of an enterprise

– The legal representative of an enterprise is an individual who represents the enterprise to exercise the rights and obligations arising from the enterprise’s transactions, represents the enterprise as a requester to resolve civil matters, plaintiff, defendant, person with related rights and obligations before the Arbitrator, Court and other rights and obligations according to the provisions of law. law.

– For two types of limited liability company and joint stock company, businesses can:

+ Have one or more legal representatives. The company charter specifies the number, management titles and rights and obligations of the legal representative of the enterprise.

+ If the company has more than one legal representative, the company charter specifies the rights and obligations of each legal representative. In case the division of rights and obligations of each legal representative is not clearly stipulated in the company’s charter, each legal representative of the company is a competent representative of the business before a third party.

+ All legal representatives must be jointly liable for damage caused to the business according to the provisions of civil law and other relevant laws.

– Enterprises must ensure that they always have at least one legal representative residing in Vietnam. When there is only one remaining legal representative residing in Vietnam, this person must, when leaving Vietnam, authorize in writing another individual residing in Vietnam to exercise the rights and obligations of the legal representative. In this case, the legal representative is still responsible for exercising the authorized rights and obligations.

– In case the authorization period expires but the legal representative of the enterprise has not returned to Vietnam and there is no other authorization, the following regulations shall apply:

+ The authorized person continues to exercise the rights and obligations of the legal representative of the private enterprise until when the legal representative of the enterprise returns to work at the enterprise;

+ The authorized person continues to exercise the rights and obligations of the legal representative of a limited liability company, joint stock company, or partnership until the legal representative of the company returns to work at the company or until the company owner, Board of members, Board of Directors decides to appoint another person to be the legal representative of the enterprise.

– Except in the case of a limited liability company with two members, for the enterprise there is only one legal representative and this person is absent from Vietnam for more than 30 days without authorizing another person to exercise the rights and obligations of the legal representative of the enterprise or is dead, missing, being prosecuted for criminal liability, detained, serving a prison sentence, or being subject to administrative handling measures at an agency. compulsory drug treatment facility, compulsory educational establishment, have limited or lost capacity for civil acts, have difficulty in cognition, control behavior, are banned by the Court from holding a position, practicing certain professions or doing certain jobs, then the company owner, the Board of members, the Board of Directors shall appoint another person to be the legal representative of the company.

– For a limited liability company with two members, if a member who is an individual acting as the legal representative of the company dies, is missing, is being prosecuted for criminal liability, is detained, is serving a prison sentence, is serving administrative measures at a mandatory drug treatment facility, a mandatory education facility, has escaped from the place of residence, has limited or lost civil act capacity, has cognitive difficulties, owns the act, is banned by the Court from holding a position, practicing a profession or doing certain jobs, the remaining member will automatically be the legal representative of the company until there is a new decision of the Board of Members on the legal representative of the company.

– Courts and other agencies competent to conduct proceedings have the right to appoint a legal representative to participate in proceedings in accordance with the provisions of law. law.

2. legal representative in each type of enterprise

– For the type of private enterprise, the legal representative is the owner of the private enterprise.

– For the type of partnership company, the legal representative is a partner.

– For the type of limited liability company with two or more members, the legal representative of the business can be Chairman of the Board of Members, Director or General Director. In cases where the company charter does not stipulate, the Chairman of the Board of Members is the legal representative.

– For a single-member limited liability company, the legal representative of the enterprise can be the Chairman of the Board of Members, the President of the company or the Director or General Director who is the legal representative. In cases where the company charter does not stipulate, the Chairman of the Board of Members or the President of the company is the legal representative of the company.

– For a joint stock company, the legal representative of the enterprise can be the Chairman of the Board of Directors or the Director or General Director. In case there is no regulation in the Charter, the Chairman of the Board of Directors is the legal representative of the company. If the company has more than one legal representative, the Chairman of the Board of Directors and the Director or General Director are of course the legal representatives of the company.

3. Responsibilities of the legal representative of the enterprise

– The legal representative of the enterprise has the following responsibilities:

+ Carry out assigned rights and obligations honestly, carefully, and best to ensure the legitimate interests of the business;

+ Loyal to the interests of the business; Do not abuse your position or position and use information, know-how, business opportunities, or other assets of the enterprise for personal gain or to serve the interests of other organizations or individuals;

+ Notify enterprises promptly, fully and accurately about enterprises that they, their related persons own or have shares or capital contributions according to regulations.

– The legal representative of the enterprise is personally responsible for damage to the enterprise due to breach of prescribed responsibilities.