Multi-Member Limited Liability Company In Vietnam

The Multi-member Limited Liability Company has the organizational structure as follows:

• Board of Members (“BOM”);
• President of the BOM;
• Director/General Director;

The company has at least one legal representative being the President of the BOM or Director or General Director. The President of the BOM is the company’s legal representative unless otherwise prescribed by the company’s charter.

The Board of Members is the supreme governing body of the company. BOM consists of all members that are individuals and authorized representatives of members that are organizations. The meetings of BOM will be held at least once per year; the company's charter shall specify the frequency of meetings of the Board of Members. BOM has the rights and obligations stipulated at article 55.2 of the Law on Enterprise are as follows:

a) Decide the company’s annual business plan and development strategy;

b) Decide increase or decrease in charter capital, time, and method for raising more capital; issuance of bonds;

c) Decide investments in the company’s development projects; solutions for market development, marketing, and technology transfer;

d) Approve contracts for borrowing, lending, sale of assets, and other contracts prescribed by the company's charter whose value is at least 50% of the total assets written in the latest financial statement (or a smaller ratio or value specified in the company's charter);

dd) Elect, dismiss the President of the Board of Members; designate, dismiss, sign, and terminate contracts with the Director/General Director, chief accountant, controllers, and other executives specified in the company's charter;

e) Decide the salaries, remunerations, bonuses, and other benefits of the President of the Board of Members, Director/General Director, chief accountant, controllers, and other executives specified in the company's charter;

g) Ratify annual financial statements, plans for use and distribution of profits or settlement of losses;

h) Decide the company’s organizational structure;

i) Decide the establishment of subsidiary companies, branches, and representative offices;

k) Revise the company's charter;

l) Decide reorganization of the company;

m) Decide dissolve or file bankruptcy of the company;

n) Other rights and obligations prescribed by Law on Enterprise and the company's charter

President is appointed by BOM and may concurrently hold the position of Director or General Director of the company. The term of office of the president of BOM is pursuant to the company’s charter but must not exceed five years and may be re-elected for an unlimited number of terms. The President of BOM has the rights and obligations stipulated in article 56.2 of the Law on Enterprise as follows:

a) Plan the activities of the Board of Members;

b) Draw up agenda and prepare documents for meetings or surveys of the Board of Members;

c) Convene and chair meetings of the Board of Members or organize surveys of the Board of Members;

d) Supervise or organize supervision of the implementation of resolutions and decisions of the Board of Members;

dd) Sign resolutions and decisions of the Board of Members on its behalf;

e) Other rights and obligations prescribed by Law on Enterprise and the company's charter.

Director/General Director is the person who manages the company’s everyday business operation and is responsible to the Board of Members for his/her performance. The Director/General Director has the rights and obligations stipulated in article 63.2 of the Law on Enterprise as follows:

a) Organize the implementation of resolutions and decisions of the Board of Members;

b) Decide everyday operating issues of the company;

c) Organize implementation of the company’s business plans and investment plans;

d) Issue the company’s rules and regulations unless otherwise prescribed by the company's charter;

dd) Designate, dismiss the company’s executives, except those within jurisdiction of the Board of Members;

e) Enter into contracts on behalf of the company, except those within jurisdiction of the President of the Board of Members;

g) Propose the company’s organizational structure;

g) Submit annual financial statements to the Board of Members;

i) Propose plans for use and distribution of profits or settlement of business losses;

k) Recruit employees;

l) Other rights and obligations specified in the company's charter, resolution and decisions of the Board of Members, and his/her employment contract.

To set up a multi-member limited liability company in Viet Nam, the investors need to prepare the documents:

 

No.	Document		Note
1	Application form for enterprise registration.		DB Legal can assist to prepare
2	The company’s charter		DB Legal can assist to prepare
3	List of members of the multi-member limited liability company		DB Legal can assist to prepare
4	Legal documents of the enterprise’s legal representative, such as passport or ID card.		The copy of this document need to be certified by the notary. If legal representative is foreigner, the document need to be translated into Vietnamese and certified by the notary.
5	Individuals	Legal documents of members that are individuals such as  passport or ID card	The copy of this document need to be certified by the notary. If legal representative is foreigner, this document need to be translated into Vietnamese and certified by the notary.
	Organizations	Legal documents of members that are organizations; Legal documents of authorized representatives of members that are organizations; Their letters of appointment of authorized representatives;	If a member is a foreign organization, copies of legal documents of that organization must be legalized, translated into Vietnamese.
6	Investment registration certificate if the enterprise is founded or co-founded by foreign investors		The certified copy

The multi-member Limited Liability Company is Viet Nam's most common legal entity form. It is the ideal form for SME enterprises to start a business in Viet Nam. DB Legal – the Law firm of Viet Nam hopes this article will assist the investor in understanding the form of business: a multi-member LLC in Viet Nam. We can assist the investor in overcoming the administrative barrier to opening the company in Viet Nam.

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