What are the specific qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
- What are the specific qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
- What are the qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
- What is the corporate governance structure of an insurer in Vietnam?
What are the specific qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
Pursuant to the provisions of Clause 2, Article 26 of Decree 46/2023/ND-CP stipulating specific qualifications required for the Head of Supervisory Board, Supervisors as follows:
- He/she obtains at least a bachelor’s degree in one of the majors in insurance, economics, finance, banking, business administration, law, accounting, or auditing.
Within 1 year from July 1, 2023, insurers, reinsurers, and foreign branches in Vietnam must ensure their Head of Supervisory Board and Supervisors meet this requirement.
- The head of the Supervisory Board must have at least 5 years of experience in the insurance, finance, or banking industry, or have at least 3 years of experience as manager, executive, or supervisor at enterprises that engage in insurance, finance, or banking industry. The Supervisor must have at least 3 years of experience in the insurance, finance, or banking industry.
- He/she is not a relative of a member of the Board of Directors, a member of the Members' Council, the Director or General Director, or another manager. The identification of relatives must comply with the Law on Enterprises.
- He/she is not a manager; is not necessarily a shareholder or employee, unless otherwise provided for in the Charter or Regulation.
What are the specific qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
What are the qualifications required for the Head of Supervisory Board or Supervisors of an insurer in Vietnam?
Pursuant to the provisions of Clause 1, Article 26 of Decree 46/2023/ND-CP stipulating the qualifications required for the Head of Supervisory Board, Supervisors as follows:
Qualifications required for the Head of Supervisory Board, Supervisors
1. General qualifications specified in Clause 1, Article 81 of the Law on Insurance Business.
At the same time, based on the provisions of Clause 1, Article 81 of the Law on Insurance Business 2022, it is stipulated as follows:
Eligibility requirements and standards of managers and controllers of insurance companies, reinsurance companies and foreign branches in Vietnam
1. General requirements and standards:
a) Reserve the corporate governance rights prescribed in the Corporate Law;
b) Not be subject to any penalty for administrative violations arising in the insurance industry; not be disciplined in the form of dismissal for any of their violations against internal regulatory procedures for handling work within 03 consecutive years before the appointment date; not be the object of the decisions on initiation of legal proceedings under the regulatory provisions of law at the election or appointment time.
Accordingly, the general requirements and standards to become Head of Supervisory Board and Supervisors of an insurer are as follows:
- Reserve the corporate governance rights prescribed in the Corporate Law;
- Not be subject to any penalty for administrative violations arising in the insurance industry; not be disciplined in the form of dismissal for any of their violations against internal regulatory procedures for handling work within 03 consecutive years before the appointment date; not be the object of the decisions on initiation of legal proceedings under the regulatory provisions of law at the election or appointment time.
What is the corporate governance structure of an insurer in Vietnam?
Pursuant to the provisions of Article 79 of the Law on Insurance Business 2022, it is stipulated as follows:
Corporate governance structure of an insurance company and reinsurance company
1. Insurance joint-stock companies and reinsurance joint-stock companies may decide on either of the two governance structures:
a) Shareholders' General Meeting, Managing Board, Supervisory Board, Director or General Director. A Supervisory Board consists of 03 – 05 controllers under the regulatory provisions of the Company’s Charter;
b) Shareholders' General Meeting, Managing Board, Director or General Director. In particular, the Managing Board shall be subject to the binding requirement that 20% of membership must be independent members and it must directly control an Audit Committee. The organizational structure, functions and duties of an Audit Committee must be specified in the Company's Charter or executive rules and regulations of the Audit Committee that are ratified by the Managing Board.
2. Insurance limited liability companies and reinsurance limited liability companies shall decide on using the corporate governance structure consisting of the Board of Members, Director or General Director. Insurance companies and reinsurance companies may make their own decisions to set up Supervisory Boards in accordance with law.
According to the above regulations, insurance enterprises established as joint stock companies have the right to choose a management structure according to one of the following two models:
- General Meeting of Shareholders, Board of Directors, Supervisory Board, Director or General Director. The Supervisory Board has from 03 to 05 Supervisors as prescribed in the Company's Charter;
- General Meeting of Shareholders, Board of Directors, Director or General Director, in which at least 20% of the members of the Board of Directors must be independent members and there is an Audit Committee under the Board of Directors .
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