Under what forms can the civil servants participate in enterprises in Vietnam?
I have savings. I want to participate in a specific type of business by becoming a member of a particular type of enterprise. However, I am currently a civil servant. What forms of enterprises can I participate in?
Under what forms can the civil servants participate in enterprises in Vietnam? - image from internet
Pursuant to Article 13 of the Law on Enterprises in 2005 stipulating the right to establishment, capital contribution, share buying and management of enterprises as follows:
1. Vietnamese and foreign organizations and individuals shall be entitled to establish and manage enterprises in Vietnam in accordance with this Law, except those stated in Clause 2 of this Article.
2. The following organizations and individuals shall not be entitled to establish and manage enterprises in Vietnam:
a/ State agencies and units of the people's armed forces in case they use state assets to set up enterprises for making their own profits;
b/ Cadres, civil servants as provided for in the law on cadres and public servants;
c/ Officers, non-commissioned officers, professional army members, defense workers at agencies or units of the Vietnam People's Army; officers, professional non-commissioned officers working in agencies or units of the Vietnam People's Police;
d/ Leading officials, managers in enterprises with 100% state-owned capital, excluding those who are appointed as authorized representatives to manage state-owned capital contributions in other enterprises:
dd/ Minors; persons whose civil act capacity is restricted or lost;
e/ Persons who are serving an imprisonment penalty or prohibited from doing business by the Court;
g/ Other cases as provided for by the law on bankruptcy.
3. Organizations and individuals shall be entitled to buy shares from joint-stock companies, make capital contribution to limited liability companies or partnerships in accordance with this Law, except those stated in Clause 4 of this Article.
4. The following organizations and individuals shall not be entitled to buy shares from joint-stock companies and make capital contribution to limited liability companies or partnerships:
a/ State agencies and units of the people's armed forces in case they use state assets to set up enterprises for making their own profits:
b/ Persons who shall not be entitled to contribute capital to enterprises as provided for in the law on cadres and civil servants.
According to the regulations, as a civil servant, you are not allowed to establish or manage any type of business entity. In terms of participation through purchasing shares of a joint-stock company, contributing capital to a limited liability company, or participating in a partnership, the following distinctions should be made:
- You cannot contribute capital to a limited liability company because the capital contributor is naturally a member of the Members' Council of the limited liability company (Article 47 of the Law on Enterprises). As a member of the Members' Council, you would have the right to manage the company (however, as a civil servant, you are not allowed to manage a company).
- You are allowed to contribute capital to a joint-stock company, but only as a shareholder (you are not allowed to participate in the Board of Management, as members of the Board of Management are responsible for managing the business according to Clause 13, Article 4 of the Law on Enterprises).
- You are allowed to contribute capital to a partnership as a contributing partner (you are not allowed to participate as a general partner because general partners are responsible for managing the partnership according to Clause 13, Article 4 of the Law on Enterprises).
Best regards!
