Regulations on member registration books of limited liability companies with two or more members according to Vietnamese law

Can a LLC with 2 or more members create a Member Registration Book using electronic data? If a LLC with 2 or more members will not be fined if they do not establish a member registration book?

1. Can a LLC with 2 or more members create a Member Registration Book using electronic data?

The creation of a Member Registration Book for a LLC with 2 or more members is stipulated in Article 48 of the 2020 Enterprise Law as follows:

Members Registration Book

1. The company must prepare a member registration book immediately after being granted the Business Registration Certificate. The member registration book can be a paper document or an electronic data collection that records ownership information of capital contributions of company members.

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

a) Name, business code, and head office address of the company;

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;

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

3. The company must promptly update member changes in the member register at the request of the relevant member according to the provisions of the company’s Charter.

4. The member registration book is kept at the company’s headquarters.

According to the above regulations, a LLC with 2 or more members can establish a member registration book in paper form or electronic data collection.

2. If a LLC with 2 or more members is not established, will it be fined?

Administrative penalties for limited liability companies with 2 or more members that do not establish a member registration book are specified in point b clause 2, point d clause 3 Article 52 Decree 122/2021/ND-CP as follows:

Other violations related to business organization and management career

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2. Fine from 30,000,000 VND to 50,000,000 VND for one of the following acts:

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b) Failure to prepare a member registration book or shareholder registration book to issue shares;

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3. Remedial measures:

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d) Force the creation of a member registration book and shareholder registration book according to regulations for violations specified in Point b, Clause 2 of this Article;

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At the same time, according to Clause 2, Article 4 of Decree 122/2021/ND-CP stipulating the fine level as follows following:

Fine level

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2. The fines specified in this Decree are the fines applicable to organizations (except the fines specified in Point c, Clause 2, Article 28; Points a and b, Clause 2, Article 38; Articles 62 and Article 63 of this Decree are the fines applicable to individuals). For the same administrative violation, the fine for an individual is equal to 1/2 (one-half) of the fine for an organization.

Accordingly, a limited liability company with 2 or more members that does not establish a member registration book may be subject to an administrative penalty with a fine ranging from 30,000,000 VND to 50,000,000 VND Dong.

At the same time, this company is also forced to create a member registration book according to regulations.

3. Who has the right to check and review the Member Registration Book of a LLC with 2 or more members?

Who has the right to check and review the Member Registration Book of a LLC with 2 or more members as prescribed in Clauses 2 and 3, Article 49 of the Law on Enterprises 2020, as amended by Clause 1, Article 7 of the Law amending the Law on Public Investment, the Law on Investment according to the Public-Private Partnership method, and the Law on Investment. Investment Law, Housing Law, Bidding Law, Electricity Law, Enterprise Law, Special Consumption Tax Law and Civil Judgment Enforcement Law 2022 as follows:

Rights of company members

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2. In addition to the rights specified in Clause 1 of this Article, members and groups of members owning 10% or more of the charter capital or a smaller percentage prescribed by the Company’s Charter or in the cases specified in Clause 3 of this Article have the following rights:

a) Request to convene a meeting of the Board of Members to resolve issues within their authority;

b) Check, review, look up records and monitor transactions, accounting books, annual financial reports;

c) Check, review, look up and copy the member registration book, meeting minutes, resolutions, decisions of the Board of Members and other documents of the company ty;

d) Request the Court to annul resolutions and decisions of the Board of Members within 90 days from the end of the meeting of the Board of Members, if the order, procedures, meeting conditions or content of the resolution or decision are not properly implemented or inconsistent with the provisions of this Law and the company’s Charter.

3. In case the company has one member owning more than 90% of the charter capital and the company’s Charter does not stipulate a smaller percentage as prescribed in Clause 2 of this Article, the remaining group of members will naturally have the rights as stipulated in Clause 2 of this Article.

Thus, a member or group of members owning 10% or more of the charter capital or another smaller percentage as stipulated by the Charter of a limited liability company with 2 or more members has can check and review the company’s Register of Members

In case a LLC with 2 or more members has one member owning more than 90% of the charter capital and the Company Charter does not stipulate a smaller percentage as prescribed, the remaining group of members naturally have the right to check and review the Company’s Register of Members.