Can members of a multiple-member limited liability company contribute assets that are different from the promised ones in Vietnam?

Can members of a multiple-member limited liability company contribute assets that are different from the promised ones in Vietnam?

Clause 2, Article 47 of the Law on Enterprises 2020 provides for capital contribution to establish the company and issuance of the certificate of capital contribution as follows:

2. The members shall contribute sufficient and correct assets as promised when applying for enterprise registration within 90 days from the issuance date of the Certificate of Enterprise Registration, excluding the time needed to transport or import the contributed assets and for completing ownership transfer procedures.  During this period, the members shall have rights and obligations that are proportional to their promised contribution. The members may only contribute assets that are different from the promised ones if the change is approved by more than 50% of the remaining members.

Thus, according to regulations in Vietnam, you can contribute assets that are different from the promised ones with the consent of more than 50% of the remaining members of the company in Vietnam.

Are members of a multiple-member limited liability company who have not fully contributed capital still members of the company in Vietnam?

Clause 3, Article 47 of the Law on Enterprises 2020 provides for capital contribution to establish the company and issuance of the certificate of capital contribution as follows:

3. In case a member fails to contribute or fully contribute capital as promised by the expiration of the period mentioned in Clause 2 of this Article:

a) The member that has not contributed capital at all is obviously no longer a member of the company;

b) The member that has not fully contributed capital will have the rights that are proportional to the contributed capital;

c) The right to contribute the missing capital will be sold under a resolution or decision of the Board of Members.

According to the above provisions in Vietnam, if you have not fully contributed capital, you are still a member of the company, however, you only have the right that are proportional to the contributed capital to the company up to the present time.

What are rights of members of a multiple-member limited liability company in Vietnam?

In Article 49 of the Enterprise Law 2020, it is amended by Clause 1, Article 7 of the Law on amendments to certain articles of the law on public investment, the law public-private partnership investment, the law on investment, the law on housing, the law on procurement, the law on electricity, the law on enterprises, the law on special excise duties and the law on civil judgment enforcement provide for rights of members of the Board of Members as follows:

1. A member of the company has the following rights:

a) Participate in meetings of the Board of Members; discuss, propose, vote on the issues within the jurisdiction of the Board of Members;

b) Have a number of votes that are proportional to the member’s holding, except for the cases specified in Clause 2 Article 47 of this Law;

c) Receive profit in proportion to the member’s holding after the company has fully paid taxes and fulfilled other financial obligations prescribed by law;

d) Receive part of the remaining assets in proportion to the member’s holding when the company is dissolved or goes bankrupt;

dd) Be given priority to contribute more capital when the company increases its charter capital;

e) Transfer, give away or otherwise dispose of the member’s own stake in accordance with regulations of law and the company's charter;

g) File lawsuits in their own name of in the company’s name against the President of the Board of Members, the Director/General Director, other executives, legal representatives in accordance with Article 72 of this Law;

h) Other rights prescribed by this Law and the company's charter.

2. In addition to the rights specified in Clause 1 of this Article, a group of members that hold at least 10% of the charter capital (or a smaller ratio prescribed by the company's charter or in the cases specified in Clause 3 of this Article) also has the rights to:

a) Demand meetings of the Board of Members be convened to resolve issues within its jurisdiction;

b) Inspect, access logbooks and monitor transactions, accounting books and annual financial statements;

c) Inspect, access, make photocopies of the member register, meeting minutes, resolutions Decree decisions of the Board of Members and other documents of the company;

d) Request the Court to invalidate the resolution or decision of the Board of Members within 90 days from the end of its meeting if the meeting procedures or contents of the resolution or decision are not fully followed or contradict regulations of this Law and the company's charter.

3. In case a member holds more than 90% of the charter capital and the company's charter does not provide for any smaller ratio as prescribed in Clause 2 of this Article, the group of remaining members obviously have the rights specified in Clause 2 of this Article.

The above are rights of members of a multiple-member limited liability company in Vietnam in accordance with the law.

Best Regards!