Can a Board director in a Vietnamese joint stock company be removed by the courts?

A Vietnamese court does not have clear authority to remove a Board director from the Board of a Vietnamese joint stock company like other more developed jurisdictions. Under Article 156.1 of the Enterprise Law 2014,  a Board director may be dismissed (miễn nhiệm) if he/she:

  • fails to maintain the qualifications of a Board director including not having full capacity for civil acts or belonging to the types of persons who are not allowed to manage an enterprise in Vietnam;   
  • fails to participate in activities of the Board for six consecutive months, except in the case of an event of force majeure; and
  • tenders a written resignation.
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Written by Nguyen Quang Vu On In ,

Purchasing shares from an individual in Vietnam

A purchaser of listed shares in a public joint stock company (Public JSC) from an individual selling such shares through his/her securities trading account does not need to verify the selling individual’s authority to sell the listed shares under the Law on Family and Marriage 2014 assuming that:

  • the listed shares are not the main sources of income of the selling individual and his/her spouse (if he/she is married); and
  • the purchaser is an innocent purchaser who does not know that the selling individual is married or that the selling individual does not have the authority to sell the listed shares under the Law on Family and Marriage 2014.
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Written by Lawyers VNLaw On In ,

Decree 71/2017 - new corporate governance rules for public joint stock companies in Vietnam

Decree 71/2017 provides for a various corporate governance rules applicable to public joint stock companies in Vietnam. Decree 71/2017 takes effect from 1 August 2017. Below is a detailed comparison between Decree 71/2017 and the old corporate governance rules under Circular 121/2012 of the Ministry of Finance. This post is contributed by Ha Thanh Phuc and Nguyen Hang Nga, legal interns at Venture North Law.

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Written by Lawyers VNLaw On In ,

COOPERATION MECHANISM IN PROCESSING APPLICATIONS FOR INVESTMENT AND ENTERPRISE REGISTRATION OF FOREIGN INVESTORS IN VIETNAM

Circular 2/2017 taking effect from 15 June 2017 regulates the cooperation mechanism in processing applications for investment registration and enterprise registration of foreign investors (cooperation mechanism). Under the cooperation, a foreign investor submits its applications for investment registration and enterprise registration and receives its registration certificates at applicable Department of Planning and Investment (DPI). Therefore, the procedure of investment registration and enterprise registration under the cooperation mechanism may reduce significantly the licensing workload of foreign investors compared to the original separate procedures of investment registration and enterprise registration  (separate procedure).

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Written by Lawyers VNLaw On In ,