Is it mandatory to elect a replacement when dismissing a member of the Board of Directors?

1. Is it mandatory to elect a replacement when dismissing a member of the Board of Directors?

According to Clause 4, Article 160 of the Enterprise Law 2020 on dismissal, removal, replacement, and supplementation of the Board of Directors, it states:

4. The Board of Directors must convene a General Meeting of Shareholders to elect an additional member to the Board of Directors in the following cases:

a) The number of members of the Board of Directors is reduced by more than one-third compared to the number specified in the company's Charter. In this case, the Board of Directors must convene a General Meeting of Shareholders within 60 days from the date the number of members is reduced by more than one-third;

b) The number of independent members of the Board of Directors is reduced, not ensuring the ratio specified at point b, clause 1, Article 137 of this Law;

c) Except for the cases specified at points a and b of this clause, the General Meeting of Shareholders shall elect a new member to replace the dismissed or removed member of the Board of Directors at the nearest meeting.

Thus, according to the above regulation, when a member of your company's Board of Directors is dismissed, it is mandatory to elect a replacement if it falls into the above cases.

2. What are the conditions to become a member of the Board of Directors?

Clause 1, Article 155 of the Enterprise Law 2020 stipulates the organizational structure, standards, and conditions to become a member of the Board of Directors. To be specific:

1. A member of the Board of Directors must meet the following standards and conditions:

a) Not fall into the category specified in clause 2, Article 17 of this Law;

b) Have professional qualifications and experience in business management or in the field, industry, and business of the company and do not necessarily have to be a shareholder of the company, unless otherwise specified by the company's Charter;

c) A member of the Board of Directors of one company may concurrently be a member of the Board of Directors of another company;

d) For state enterprises as specified at point b, clause 1, Article 88 of this Law and subsidiaries of state enterprises as specified in clause 1, Article 88 of this Law, members of the Board of Directors must not have family relations with the Director, General Director, or other managers of the company; with the managers, or the person authorized to appoint the manager of the parent company.

Based on these regulations, if you want to become a member of the company's Board of Directors, you must fully meet all these conditions.

Respectfully!