Requirements to be satisfied by members of the Board of Members in Vietnam

Requirements to be satisfied by members of the Board of Members in Vietnam (Internet image) 

Regarding this issue, LawNet responded as follows:

1. Requirements to be satisfied by members of the Board of Members in Vietnam

According to Article 93 of the Law on Enterprises 2020, to become a member of the Board of Members, a person shall satisfy the following requirements:

- He/she is not one of the persons specified in Clause 2 Article 17 of the Law on Enterprises 2020.

+ State authorities, People’s armed forces using state-owned assets to establish enterprises to serve their own interests;

+ Officials and public employees defined by the Law on Officials and the Law on Public Employees;

+ Commissioned officers, non-commissioned officers, career military personnel, military workers and public employees in agencies and units of Vietnam People’s Army; commissioned officers, non-commissioned officers and police workers in police authorities and units, except for those designated and authorized representatives to manage state-owned stakes in enterprises or to manage state-owned enterprises;

+ Executive officers and managers of state-owned enterprises prescribed in Point a Clause 1 Article 88 of the Law on Enterprises 2020, except those who are designated as authorized representatives to manage state-owned stakes in other enterprises;

+ Minors; people with limited legal capacity; incapacitated people; people having difficulties controlling their behaviors; organizations that are not juridical persons;

+ People who are facing criminal prosecution, kept in temporary detention, serving an imprisonment sentence, serving an administrative penalty in a correctional institution or rehabilitation center, has limited legal capacity or is incapacitated, is not able to control his/her own behaviors, is banned by the court from holding certain positions or doing certain works;

Other cases prescribed by the Law on Bankruptcy and the Anti-corruption Law.

If requested by the business registration authority, the applicant shall submit the judicial records;

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

- He/she has professional qualifications and experience of busines administration or experience of the company’s business lines.

- He/she is not a relative of the head or deputies of the state ownership representative body; any of the members of the Board of members, the Director/General Director, the Deputy Director/General Director, the chief accountant or Controllers of the company.

- He/she is not an executive of the member enterprise.

- A member of the Board of Members other than the President may concurrently hold the position of Director/General Director of the company or another company that is not a member enterprise under a decision of the state ownership representative body.

- He/she has never been discharged from the position of President of the Board of Members, member of Board of Members, the company’s President, Director/General Director, Deputy Director/General Director of a state-owned enterprise.

- He/she satisfies other requirements specified in the company’s charter.

2. Regulations on dismissal, discharge of members of the Board of Members in Vietnam

Regulations on dismissal, discharge of members of the Board of Members in Vietnam under Article 94 of the Law on Enterprises 2020 are as follows:

- The President or another member of the Board of Members shall be dismissed in the following cases:

+ He/she does not fully satisfy the requirements specified in Article 93 of this Law;

+ He/she hands in the resignation and is accepted in writing by the state ownership representative body;

+ A reassignment or retirement decision is issued;

+ He/she is not capable of or qualified for the given tasks;

+ He/she is not healthy or reputable enough to hold the position.

- The President or another member of the Board of Members shall be discharge from duty in the following cases:

+ The company fails to achieve the annual targets; fails to conserve and develop investment capital as required by the state ownership representative body without an excuse that is objective or accepted by the state ownership representative body;

+ He/she is convicted by the Court under an effective judgment or decision;

+ He/she fails to perform her duties in an honest manner or abuses his/her power and position or uses the company’s assets for personal gain or serve any other organization’s or individual’s interests; fails to truthfully report the company’s finance and business performance.

- Within 60 days from the issuance date of the decision to dismiss or discharge the President or member of the Board of Members, the state ownership representative body shall designate another person as President or member.

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