What is a juridical person in Vietnam? What are the regulations on the status of a juridical person of enterprises?
- What is a juridical person in Vietnam?
- Do single-member limited liability companies have the status of a juridical person in Vietnam?
- Do multi-member limited liability companies have the status of a juridical person in Vietnam?
- What are the regulations on the status of a juridical person of partnerships in Vietnam?
- What are the regulations on the status of a juridical person of a joint stock company in Vietnam?
- What are the regulations on the status of a juridical person of a sole proprietorship in Vietnam?
What is a juridical person in Vietnam?
Pursuant to Article 74 of the 2015 Civil Code, juridical persons are as follows:
Juridical persons
1. An organization shall be recognized as a juridical person if it meets all of the following conditions:
a) It is legally established as prescribed in this Code and relevant laws;
b) It has an organizational structure prescribed in Article 83 of this Code;
c) It has property independent from other natural and juridical persons and bears liability by recourse to its property;
d) It participates independently in legal relations in its own name.
2. Every natural or juridical person has the right to establish a juridical person, otherwise provided for by law.
Thus, an organization shall be recognized as a juridical person if it meets all of the following conditions:
- It is legally established as prescribed in this Code and relevant laws;
- It has an organizational structure prescribed in Article 83 of this Code;
- It has property independent from other natural and juridical persons and bears liability by recourse to its property;
- It participates independently in legal relations in its own name.
What is a juridical person in Vietnam? What are the regulations on the status of a juridical person of enterprises?
Do single-member limited liability companies have the status of a juridical person in Vietnam?
Pursuant to Article 74 of the Law on Enterprise 2020 provides for this content as follows:
Single-member limited liability companies
1. A single-member limited liability company is an enterprise owned by a single organization or individual ((hereinafter referred to as “owner”). The owner’s liability for the company’s debts and other liabilities shall be equal to the company’s charter capital.
2. A single-member limited liability company has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
3. A single-member limited liability company must not issue shares except for equitization.
4. Single-member limited liability companies may issue bonds in accordance with this Law and relevant laws; private placement of bonds shall comply with Article 128 and Article 129 of this Law.
Thus, a single-member limited liability company is an enterprise owned by a single organization or individual ((hereinafter referred to as “owner”). The owner’s liability for the company’s debts and other liabilities shall be equal to the company’s charter capital.
A single-member limited liability company has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
Do multi-member limited liability companies have the status of a juridical person in Vietnam?
For multi-member limited liability companies, the legal status is specified in Article 46 of the Law on Enterprise 2020 as follows:
Multi-member limited liability companies
1. A multiple-member limited liability company means an enterprise that has 02 – 50 members that are organizations or individuals. A member’s liability for the enterprise’s debts and other liabilities shall be equal to the amount of capital that member contributed to the enterprise, except for the cases specified in Clause 4 Article 47 of this Law. The member’s stake (contributed capital) may only be transferred in accordance with Articles 51, 52 and 53 of this Law.
2. A multiple-member limited liability company has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
3. Multiple-member limited liability companies must not issue shares except for equitization.
4. Multiple-member limited liability companies may issue bonds in accordance with this Law and relevant laws; private placement of bonds shall comply with Article 128 and Article 129 of this Law.
Accordingly, a limited liability company with two or more members shall have legal status from the date of issuance of the Certificate of Business Registration.
What are the regulations on the status of a juridical person of partnerships in Vietnam?
According to the provisions of Article 177 of the Law on Enterprise 2020, the partnership company has the following contents:
Partnerships
1. A partnership is an enterprise in which:
a) There are least 02 partners that are joint owners of the company and do business under the same name ((hereinafter referred to as “general partner”). There can be limited partners in addition to general partners;
b) A general partner shall be an individual whose liability for the company’s obligations is equal to all of his/her assets;
c) A limited partner can be an organization or an individual whose liability for the company’s debts is equal to the promised capital contribution.
2. A partnership has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
3. A partnership must not issue any kind of securities.
Accordingly, a partnership has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
What are the regulations on the status of a juridical person of a joint stock company in Vietnam?
Pursuant to Article 111 of the Law on Enterprise 2020 stipulates on joint stock companies as follows:
Joint stock companies
1. A joint stock company is an enterprise in which:
a) The charter capital is divided into units of equal value called shares;
b) Shareholders can be organizations and individuals; the minimum number of shareholders is 03; there is no limit on the maximum number of shareholders;
a) A shareholder’s liability for the company’s debts and liabilities is equal to the amount of capital contributed to the company by the shareholder;
d) Shareholders may transfer their shares to other persons except for the cases specified in Clause 3 Article 120 and Clause 1 Article 127 of this Law.
2. A joint stock company has the status of a juridical person from the day on which the Certificate of Enterprise Registration is issued.
3. A joint stock company may issue shares, bonds and other kinds of securities.
Thus, a joint stock company has legal status from the date of issuance of the Certificate of Business Registration.
What are the regulations on the status of a juridical person of a sole proprietorship in Vietnam?
However, for sole proprietorships, Article 188 of the Law on Enterprise 2020 has the following specific provisions:
Sole proprietorships
1. A sole proprietorship is an enterprise owned by a single individual whose liability for its entire operation is equal to his/her total assets.
2. A sole proprietorship must not issue any kind of securities.
3. An individual may only establish one sole proprietorship. The owner of a sole proprietorship must not concurrently own a household business or hold the position of general partner of a partnership.
4. A sole proprietorship must not contribute capital upon establishment or purchase shares or stakes of partnerships, limited liability companies or joint stock companies.
Another difference from the above-mentioned types of businesses, the assets of a sole proprietorship and its owner are not independent. The owner of a sole proprietorship is solely responsible with his or her entire property for all the activities of the business.
Accordingly, a sole proprietorship does not meet the conditions of having assets independent of other individuals or legal entities and is responsible for its own assets.
Therefore, a sole proprietorship has no legal status.
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