Additional subject who do not have the right to establish and manage enterprises in Vietnam as of January 1, 2021

Additional subject who do not have the right to establish and manage enterprises in Vietnam as of January 1, 2021 (Internet image)

Currently, Clause 2, Article 18 of the Law on Enterprises 2014 regulates that the following entities are not permitted to establish and manage enterprises in Vietnam:

- Government agencies, armed force units using state-owned property to establish enterprises for self-seeking purposes.

- Officials and civil servants defined by regulations of law on officials and civil servants;

- Commissioned officers, non-commissioned officers, workers and civil servants working at units of the army; commissioned officers, non-commissioned officers working at police units, except for those appointed as authorized representatives to manage state capital contributed to other enterprises;

- Executive officers of state-owned companies, except for those appointed as authorized representatives to manage state capital contributed to other enterprises;

- Minors; people that are legally incompetent; organizations without legal status;

- Any person facing criminal prosecution, serving a prison sentence, undergoing drug rehabilitation, sent to a reform school; or banned from doing business, holding a certain title or doing a certain job by the court; and other cases prescribed by regulations of law on bankruptcy and anti-corruption.

However, at Point g, Clause 2, Article 17 of the Law on Enterprise 2020, additional subject who do not have the right to establish and manage enterprises in Vietnam is as follows:

Juridical persons that are banned from business operation or banned from certain fields as prescribed by the Criminal Code.

In addition, the Law on Enterprise 2020 has taken a new step forward in simplifying administrative procedures, by allowing enterprises to use electronic signatures instead of physical seals and eliminating the requirement to register seals on the national information portal before using them, specifically:

Article 43. The enterprise’s seals

1. The enterprise’s seals can be physical or digital as prescribed by e-transaction laws.

2. The enterprise shall decide the type, quantity, design and content of its seal and the seals of its branches, representative offices and other units.

3. The management and storage of seals shall comply with the company's charter or regulations of the enterprise, branch, representative office or unit that owns the seal. Seals shall be used by enterprises in transactions as prescribed by law.

Thus, from January 1, 2021, the state will tighten the rights to establish and manage enterprises in Vietnam while simplifying administrative procedures for current enterprises.

Le Hai

>> CLICK HERE TO READ THIS ARTICLE IN VIETNAMESE