Enterprise Law 2020 will officially take effect on January 01, 2021. From this point, there are 09 subjects who will not have the right to establish and manage enterprises.
Article table of contents
From 2021, there are 09 types of individuals who are not entitled to establish and manage enterprises (Illustrative photo)
To be specific, as per Clause 2, Article 17 of Enterprise Law 2020, the following 09 types of individuals are not entitled to establish and manage enterprises:
(1) State agencies, units of the People's Armed Forces using state assets to establish enterprises for profit for their own agencies or units.
(2) Officials and public employees under the provisions of Law on Cadres and Civil Servants and Law on Public Employees.
(3) Officers, non-commissioned officers, professional soldiers, defense workers, and public employees in agencies and units belonging to the Vietnam People's Army.
(4) Officers, non-commissioned professional officers, and police workers in agencies and units belonging to the Vietnam People's Public Security.
Note: Individuals appointed to represent the State-owned capital portion in enterprises or manage State-owned enterprises still have the right to manage enterprises.
(5) Heads, managers in enterprises with 100% charter capital held by the State as specified at Point a, Clause 1, Article 88 of Enterprise Law 2020.
Note: Individuals appointed to represent the State's capital portion in other enterprises still have the right to manage enterprises.
(6) Minors; individuals restricted in civil act capacity; individuals losing civil act capacity; individuals having difficulty in awareness or behavior control.
(7) Organizations that are not legal persons.
(8) Individuals being prosecuted for criminal liability, held in detention, serving imprisonment sentences, undergoing administrative handling measures at compulsory detoxification establishments, compulsory educational establishments, or prohibited by the Court from holding positions, practicing professions, or performing certain jobs; other cases as prescribed by the Law on Bankruptcy, Law on Anti-Corruption.
Note: In cases where the business registration agency requires, the individual registering for enterprise establishment must submit a Judicial Record Certificate to the business registration agency.
(09) Organizations that are commercial legal entities banned from business and banned from certain activities according to the provisions of the Criminal Code.
Comparing this with the provisions of the Enterprise Law 2014, it can be seen that the Enterprise Law 2020 adds 03 more types of individuals who are not entitled to establish and manage enterprises, including:
- Police workers in agencies and units belonging to the Vietnam People's Public Security;- Individuals having difficulty in awareness or behavior control;- Organizations that are commercial legal entities banned from business and banned from certain activities according to the provisions of the Criminal Code.
Thus, the law restricts the right to establish and manage enterprises for certain individuals primarily based on their titles, positions, and responsibilities. The objective is to ensure transparency and create a healthy competitive environment for all entities involved in establishing and managing enterprises. Furthermore, individuals with law violations, subjected to sanctions such as banning from holding positions, practicing professions, or doing business in certain fields, will also be prohibited from establishing and managing enterprises.
The above represents the entire consultation from the Editorial Board of THU KY LUAT on individuals restricted from establishing and managing enterprises, hoping this information will be useful for our valued clients and members who are looking to establish a business.
Thuy Tram
