At least how many ordinary shares must founding shareholders buy upon enterprise registration in Vietnam?

At least how many ordinary shares must founding shareholders buy upon enterprise registration in Vietnam?

Pursuant to Article 120 of the Enterprise Law 2020, ordinary shares of founding shareholders are as follows:

1. A new joint stock company shall have at least 03 founding shareholders. A joint stock company converted from a state-owned enterprise or limited liability company or after division, consolidation, acquisition of another joint stock company is not required to have founding shareholders. Instead, the company's charter in the enterprise registration application shall contain signatures of the company’s legal representatives or ordinary shareholders.

2. The founding shareholders shall subscribe for at least 20% of the total authorized ordinary shares upon enterprise registration.

3. Within 03 years from the issuance date of the Certificate of Enterprise Registration, the ordinary shares of founding shareholders may be transferred to other founding shareholders and may only be transferred to a person that is not a founding shareholder if the transfer is accepted by the GMS. In this case, the transferor does not have the right to vote on this transfer.

4. The limitations specified in Clause 3 of this Article do not apply to the following ordinary shares:

a) Additional shares acquired by founding shareholders after the enterprise is registered;

b) Shares that have been transferred to other persons that are not founding shareholders.

Thus, founding shareholders must subscribe for at least 20% of the total authorized ordinary shares upon enterprise registration in Vietnam.

Can shareholders withdraw contributed capital in the form of ordinary shares from the company in Vietnam?

According to Article 119 of the Enterprise Law 2020, obligations of shareholders are as follows:

1. Fully and punctually pay for their subscribed shares.

2. Do not withdraw contributed capital in the form of ordinary shares in any shape or form, unless the shares are purchased by the company or other persons. The shareholder that withdraws all or part of the share capital against regulations of this Clause and persons with related interests in the company shall have a liability for the company’s debts and other liabilities which is equal to the value of the shares withdrawn and the damage caused by this action.

3. Comply with the company's charter, rules and regulations.

4. Comply with resolutions and decisions of the Board of Directors and the GMS.

5. Protect the confidentiality of information provided by the company in accordance with the company's charter and the law; only use the provided information to perform and protect their lawful rights and interests; do not spread or share information provided by the company to any other organization or individual.

6. Other obligations prescribed by Law and the company's charter.

According to this Article, shareholders are not allowed to withdraw contributed capital in the form of ordinary shares in any shape or form, unless the shares are purchased by the company or other persons. If withdrawing all or part of the share capital against regulations, they must take responsibility according to the provisions of law in Vietnam.

Best Regards!