Regulations on authorized representatives of the owner/members/partners/shareholders that are organizations in Vietnam

Regulations on authorized representatives of the owner/members/partners/shareholders that are organizations in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Regulations on authorized representatives of the owner/members/partners/shareholders that are organizations in Vietnam

Regulations on authorized representatives of the owner/members/partners/shareholders that are organizations according to Article 14 of the Law on Enterprise 2020 are as follows:

- Authorized representatives of the owner/members/partners/shareholders that are organizations shall be authorized in writing by the owner/members/partners/shareholders in accordance with the Law on Enterprise 2020.

- Unless otherwise prescribed by the charter, the designation of the authorized representative shall comply with the following regulations:

+ An organization that is a member of a multiple-member limited liability company and holds at least 35% of charter capital may designate up to 03 authorized representatives;

+ An organization that is a shareholder of a joint stock company and holds at least 10% of ordinary shares may designate up to 03 authorized representatives.

- In case the owner/members/partners/shareholders designate more than one authorized representative, the holding represented by each of them shall be specified. Otherwise, the total holding shall be equally divided among the authorized representatives.

- The document designating the authorized representative shall be informed to the company, be effective on the date it is received by the company and contain the following information:

+ Names, enterprise identification (EID) numbers, headquarters addresses of the owner/members/partners/shareholders;

+ Quantity of authorized representatives and their holdings;

+ Full name, mailing address, nationality, legal document number of each authorized representative;

+ The beginning date and duration of authorization of each authorized representative;

+ Full names and signatures of the legal representatives of the owner/members/partners/shareholders and of the authorized representatives.

- An authorized representative shall satisfy the following requirements:

+ The authorized representative is not an entity specified in Clause 2 Article 17 of the Law on Enterprise 2020;

+ Members/partners/shareholders of state-owned enterprises prescribed in Point b Clause 1 Article 88 of the Law on Enterprise 2020 must not designate a relative of the executive and the person having the power to designate the executive as representative of another company;

+ Other requirements specified in the company’s charter.

2. Responsibilities of authorized representatives of the owner/members/partners/shareholders that are organizations in Vietnam

Responsibilities of authorized representatives of the owner/members/partners/shareholders that are organizations in Vietnam under Article 15 of the Law on Enterprise 2020 are as follows:

- Authorized representatives of the owner/members/partners/shareholders shall exercise and perform their rights and obligations in accordance with the Law on Enterprise 2020.

All limits imposed by the owner/members/partners/shareholders to the authorized representatives’ performance at the Board of Members/Partners or General Meeting of Shareholders shall not apply to any third party.

- Authorized representatives have the responsibility to attend all meetings of the Board of Members/Partners or General Meeting of Shareholders; exercise and perform the authorized rights and obligations in an honest and prudent manner to protect lawful interest of the owner/members/partners/shareholders that designated them.

- Authorized representatives shall be responsible to the owner, members/partners/shareholders for fulfillment of the responsibilities specified in Article 15 of the Law on Enterprise 2020.

The owner, members/partners/shareholders that designate these authorized representatives shall be responsible to third parties for performance of these authorized representative.

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