How is the transfer of capital contributions in a limited liability company with two or more members done? Can members freely transfer their capital contributions to other individuals and organizations that are not members of the company? This article shares the legal regulations surrounding the transfer of capital contributions in limited liability companies with two or more members according to current legal regulations.

CSPL: Articles 51, 52, 53 Law on Enterprises 2020

1. Buyback of capital contribution

– A member has the right to request the company to buy back his/her capital contribution if that member has voted against the resolutions and decisions of the Board of Members on the following issues:

+ Amending and supplementing the contents of the company’s Charter related to the rights and obligations of members and the Board of Members;

+ Organization reorganization of the company;

+ Other cases as prescribed in the company’s Charter.

– Requests to repurchase capital contributions must be in writing and sent to the company within 15 days from the date of passing the resolution or decision.

– Within 15 days from the date of receiving the member’s request, the company must repurchase the capital contributions of member at the market price or price determined according to the principles specified in the company’s Charter, unless the two parties can agree on the price. Payment will only be made if, after paying in full for the repurchased capital contribution, the company still pays all debts and other property obligations.

– In case the company cannot pay for the capital contribution required to be repurchased according to regulations, that member has the right to freely transfer his/her capital contribution to another member or person who is not a member of the company.

2. Transfer of capital contributions

– According to the provisions of Article 52 of the Law on Enterprises 2020, the transfer of capital contributions of members in a two-member limited liability company is carried out as follows:

Article 52. Transfer of capital contributions

1. Except for the cases specified in Clause 4, Article 51, Clause 6 and Clause 7, Article 53 of this Law, members of a limited liability company with two or more members have the right to transfer part or all of their capital contribution to others according to the following regulations:

a) Offer to sell that capital contribution to the remaining members in proportion to their capital contribution in the company with the same offering conditions sell;

b) Transfer with the same offering conditions for the remaining members specified in point a of this clause to non-members if the remaining members of the company do not buy or do not buy all within 30 days from the date of offering.

…

Conclusion: According to the above regulations, members of a two-member limited liability company are not allowed to freely transfer their capital contribution to individuals/organizations that are not members of the company but are required to offer it to the remaining members in proportion to their capital contribution in the company with the same offering conditions. Within 30 days from the date of offering, if the remaining members do not buy or do not buy all, the new member has the right to transfer his/her capital contribution to another individual/organization that is not a member of the company. 

– However, a member who wants to transfer the capital contribution does not need to offer it to the remaining members in proportion to their capital contribution in the company with the same offering conditions in the following cases:

+ In case the company cannot pay the capital contribution required to be repurchased, that member has the right to freely transfer his/her capital contribution to another member or person who is not a public member. company;

+ In case a member donates part or all of his/her capital contribution in the company to another person;

+ In case the member uses the capital contribution to repay debt.

– The transferring member still has the rights and obligations to the company corresponding to the relevant capital contribution until information about the buyer is fully recorded in the register member.

– In case of transfer or change in capital contributions of members resulting in only one member of the company remaining, the company must organize management in the form of a one-member limited liability company and register to change the business registration content within 15 days from the date of completion of the transfer.

3. Handling capital contributions in some special cases

– In case a company member who is an individual dies, the member’s will or legal heir is a member of the company.

– In case a member is an individual who is declared missing by the Court, the member’s rights and obligations will be exercised through the member’s asset manager in accordance with the provisions of civil law. events.

– In case a member has limited or lost civil act capacity, has difficulty in cognition and behavior control, the rights and obligations of that member in the company are exercised through a representative.

– The member’s capital contribution is bought back or transferred by the company according to regulations in the following cases:

+ The heir does not want to become a member;

+ The person who is donated according to regulations is not approved by the Board of Members to become a member;

+ The company member is a dissolved or bankrupt organization.

– In case the capital contribution of a company member who is an individual dies without an heir, the heir refuses to receive inheritance or is disinherited, that capital contribution will be dissolved. decided according to the provisions of civil law.

– In case a member donates part or all of his/her capital contribution in the company to another person, the donee becomes a member of the company according to the following provisions:

+ The donee is an heir under the law according to the provisions of the Civil Code, then this person is automatically a member of the public. company;

+ The recipient who is not a legal heir according to the provisions of the Civil Code only becomes a member of the company when approved by the Board of Members.

– In case a member uses capital contribution to pay debt, the recipient of payment has the right to use that capital contribution in one of the following two forms:

+ Become a member company members if approved by the Board of members;

+ Offer to sell and transfer that capital contribution according to regulations.

– In case a company member is an individual who is detained, is serving a prison sentence, or is serving administrative measures at a mandatory drug treatment facility or compulsory education facility, that member authorizes another person to exercise some or all of his or her rights and obligations at the company. company.

– In case a company member is an individual banned by the Court from practicing certain professions or doing certain jobs or a company member is a commercial legal entity banned by the Court from doing business or operating in certain fields within the scope of the company’s business lines, that member is not allowed to practice or do banned jobs at that company or the company temporarily suspends or terminates the relevant business line according to the Court’s decision.