Chương 3 Luật Doanh nghiệp 1999: Công ty trách nhiệm hữu hạn

Chapter III

LIMITED LIABILITY COMPANIES

Section I. LIMITED LIABILITY COMPANIES WITH TWO MEMBERS OR MORE

Article 26.- Limited liability companies

1. A limited liability company is an enterprise, in which:

a/ A member is liable for the debts and other property obligations of the enterprise within the amount of capital he/she/it has undertaken to contribute to the enterprise;

b/ The share of contributed capital of each member may only be assigned in accordance with Article 32 of this Law;

c/ A member may be an organization or an individual; the number of members shall not exceed fifty.

2. A limited liability company shall not be entitled to issue shares.

3. A limited liability company has the legal person status as from the date it is granted the business registration certificate.

Article 27.- Capital contribution and granting of capital contribution certificates

1. Members shall have to contribute capital fully and on time as committed. Where a member fails to contribute it fully and on time as committed, the amount of capital not yet contributed shall be considered a debt that member owes the company; such member shall have to compensate for any damage arising from such failure to contribute capital fully and on time as committed.

The legal representative of the company must notify the business registration body in writing of the case referred to in Paragraph 1 of this Clause within thirty days from the date the contribution was due. If no written notice is delivered to the business registration body after this time limit, the member who has not fully contributed capital and the legal representative of the company must be jointly liable to the company for the amount of capital not yet contributed and any damage arising from the failure to contribute capital fully and on time as committed.

2. Upon the full payment of capital contribution, the member shall be granted a capital contribution certificate by the company. A capital contribution certificate must contain the following principal details:

a/ Name, head-office of the company;

b/ The serial number and the date of issue of the business registration certificate;

c/ Charter capital of the company;

d/ Names and addresses of the members;

e/ The members’ contributed capital shares and their values;

f/ The serial number and the date of issue of capital contribution certificate;

g/ Signature of the legal representative of the company.

3. Where a capital contribution certificate is lost, torn, burnt or otherwise destroyed, the member will be granted by the company a new capital contribution certificate and must pay fee as stipulated by the company.

Article 28.- Register of members

1. A company must forthwith set a register of members after business registration. A register of members must contain the following principal contents:

a/ Name and head-office of the company;

b/ Names, addresses and signatures of members or their legal representatives;

c/ Value of contributed capital at the time of contribution and the contributed capital share of each member; the time of capital contribution; the types of asset contributed as capital, quantity, value of each type of asset contributed as capital;

d/ Serial number and the date of issuance of capital contribution certificate of each member.

2. The register of members shall be kept at the head office of the company or elsewhere provided that written notice thereof is given to the business registration body and all the members.

Article 29.- Rights of a member

1. A member of a limited liability company has the right to:

a/ Be distributed with profits after the company has paid taxes and fulfilled other financial obligations as provided for by law in proportion to his/her/its share of contributed capital in the company;

b/ Attend meetings of the Members’ Council, discuss, make recommendations and vote on matters within the authority of the Members’ Council;

c/ Have the number of votes in proportion to his/her/its share of contributed capital;

d/ Have access to the register of members, books of account, annual financial reports, other documents of the company and receive extracts or copies of these documents;

e/ Be distributed with the residual value of assets of the company in proportion to his/her/its share of contributed capital in the company upon dissolution or bankruptcy of the company;

f/ Be given priority in making additional capital contributions to the company when it increases its charter capital; be entitled to assign partly or wholly his/her/its share of contributed capital;

g/ Initiate a lawsuit against the Director (General Director) when the Director (General Director) fails to properly perform his/her obligations and cause damage to the interest of such member;

h) Other rights stipulated in this Law and the Charter of the company.

2. A member or a group of members holding more than 35% of the charter capital or a smaller percentage as stipulated in the Charter of the company shall have the right to request that a meeting of the Members’ Council be convened to deal with issues within its authority.

Article 30.- Obligations of members

1. To contribute in full and on time the amount of capital as committed and to be liable for the debts and other property obligations of the company within the amount of capital he/she/it undertakes to contribute to the company.

2. To abide by the Charter of the company.

3. To observe decisions of the Members’ Council.

4. To fulfill other obligations stipulated in this Law and the Charter of the company.

Article 31.- Redemption of shares of contributed capital

1. A member may demand the company to redeem his/her/its share of contributed capital if such member votes against or objects in writing to a decision of the Members’ Council on the following issues:

a/ Amendment and/or supplement to the provisions of the Charter of the company relating to the rights and obligations of members, and rights and duties of the Members’ Council;

b/ Reorganization of the company;

c/ Other cases stipulated in the Charter of the company.

The demand for redemption of share of contributed capital must be made in writing and sent to the company within fifteen days from the date the decision is adopted on the issues stipulated in Points a, b and c of this Clause.

2. When a member makes a demand as stipulated in Clause 1 of this Article and no agreement can be reached on the price, the company shall have to redeem the contributed capital share of such member at the market price or at the price calculated according to the principles prescribed in the Charter of the company within fifteen days from the date of receipt of such demand.

Payment shall be made only if after the full payment for such redeemed share of contributed capital , the company is still able to pay all debts and fulfill other property obligations.

Article 32.- Assignment of contributed capital shares

Members of limited liability companies may assign a part or the whole of their shares of contributed capital to other persons according to the following regulations:

1. A member wishing to assign a part or whole of his/her/its share of contributed capital shall offer to sell such share of equity to all other members in proportion to their shares of equity in the company on the same terms;

2. Assignment to non members is permitted only if the other members of the company do not buy or do not buy out.

Article 33.- Dealing with shares of contributed capital in other cases

1. Where a member being an individual who is dead or who is declared dead by the court, his/her heir may become a member of the company, if so approved by the Members’ Council.

2. Where a member’s capacity for civil acts is restricted or lost, the rights and obligations of such member in the company shall be exercised by his/her guardian, if the latter is approved by the Members’ Council.

3. Where an heir referred to in Clause 1 of this Article is not approved by the Members’ Council or does not wish to become a member, where the guardian of a member referred to in Clause 2 of this Article is not approved by the Members’ Council, or where a member being an organization is dissolved or bankrupt, the contributed capital share of such member shall be redeemed by the company in accordance with Article 31 of this Law or be assigned in accordance with Article 32 of this Law.

4. Where a member being an individual dies without heir or where his/her heir refuses to accept the inheritance or is deprived of his/her right to inherit, the company shall have to pay the value of such share contributed capital to the State budget.

Article 34.- Organizational and managerial structure of the company

A limited liability company with two members or more shall have a Members’ Council, Chairman of the Members’ Council and a Director (General Director). A limited liability company with more than eleven members must also have a Control Board. The powers, obligations and working regulations of the Control Board and the head of the Control Board shall be stipulated in the Charter of the company.

Article 35.- Members’ Councils

1. The Members’ Council comprises all members and is the highest decision-making body of the company. Where a member is an organization, such member shall appoint its representative to be on the Members’ Council. The Members’ Council shall meet at least once a year.

2. The Members’ Council shall have the following rights and duties:

a/ To decide orientation for the development of the company;

b/ To decide the increase or decrease of the charter capital, as well as the timing and method of mobilizing additional capital;

c/ To decide the form of investment and investment projects having a value larger than 50% of the total value of assets recorded in the accounting books of the company or a smaller percentage as stipulated in the Charter of the company;

d/ To approve contracts for loans or for sale of assets having a value equal to or larger than 50% of the value of assets recorded in the accounting books of the company or a smaller percentage as stipulated in the Charter of the company;

e/ To elect, remove or dismiss the Chairman of the Members’ Council; to make decisions on the appointment, removal or dismissal of the Director (General Director), chief accountant and other important managers stipulated in the Charter of the company;

f/ To make decisions on salary and other benefits for the Director (General Director), chief accountant and other important managers stipulated in the Charter of the company;

g/ To approve annual financial reports, plans for use and distribution of profits or plans for dealing with losses of the company;

h/ To decide the organizational and managerial structure of the company;

i/ To decide the setting up of branches and representative offices;

j/ To make amendments or supplements to the Charter of the company;

k/ To decide reorganization of the company;

l/ To decide dissolution of the company;

m/ Other rights and duties stipulated in this Law and in the Charter of the company.

Article 36.- Chairman of the Members’ Council

1. The Members’ Council shall elect a member to be its Chairman. The Chairman of the Members’ Council may concurrently work as the Director (General Director) of the company.

2. The Chairman of the Members’ Council shall have the following rights and duties:

a/ To prepare working programs and plans of the Members’ Council;

b/ To prepare agendas, contents and documents for meetings of the Members’ Council or for consulting members;

c/ To convene and preside over meetings of the Members’ Council or to consult members;

d/ To supervise the implementation of decisions of the Members’ Council;

e/ To sign decisions of the Members’ Council on behalf of the Members’ Council;

f/ Other rights and duties prescribed in this Law and the Charter of the company.

3. The term of the Chairman of the Members’ Council shall not exceed three years. The Chairman of the Members’ Council may be re-elected.

4. Where the Charter of the company provides that the Chairman of the Members’ Council is the legal representative, such provision shall be clearly stated in all transaction documents.

Article 37.- Convening meetings of the Members’ Council

1. A meeting of the Members’ Council may be convened at any time at the request of the Chairman of the Members’ Council or of a member or a group of members stipulated in Clause 2 of Article 29 of this Law.

2. The agenda and documents for a meeting must be sent to members of the company prior to the opening day of the meeting. Such prior period shall be stipulated in the Charter of the company.

Article 38.- Conditions and procedures for conducting meetings of the Members's Council

1. A meeting of the Members’ Council shall be conducted when the attending members represent at least 65% of the charter capital. The specific percentage shall be stipulated in the Charter of the company.

2. Where a meeting does not take place because the condition stipulated in Clause 1 of this Article is not satisfied, the meeting may be convened for the second time within fifteen days from the date the first meeting was intended to be opened. A meeting of the Members’ Council which is convened for the second time shall be conducted when the attending members represent at least 50% of the charter capital. The specific percentage shall be stipulated in the Charter of the company.

3. Where a meeting which has been convened for the second time does not take place because the condition stipulated in Clause 2 of this Article is not satisfied, it may be convened for the third time within ten days from the date the second-time meeting was intended to be opened. In this case, the meeting of the Members’ Council shall be conducted regardless of the number of attending members.

4. A member may authorize another member in writing to attend a meeting of the Members’ Council. The procedures for conducting meetings of the Members’ Council and the voting method shall be stipulated by the Charter of the company.

Article 39.- Decisions of the Members’ Council

1. The Members’ Council shall make decisions within its authority by way of voting at meetings or obtaining written opinions.

2. A decision of the Members’ Council shall be passed at a meeting when:

a/ It is approved by the number of votes representing at least 51% of the capital of the attending members. The specific percentage shall be stipulated in the Charter of the company;

b/ With regard to decisions to sell assets having a value equal to or larger than 50% of the total value of assets recorded in the accounting books of the company or a smaller percentage as stipulated in the Charter of the company, to make amendments and supplements to the Charter of the company and/or to reorganize or dissolve the company, they must be approved by the number of votes representing at least 75% of the capital of the attending members. The specific percentage shall be stipulated in the Charter of the company.

3. A decision of the Members’ Council shall be passed by way of obtaining written opinions if it is approved by members representing at least 65% of the charter capital. The specific percentage shall be stipulated in the Charter of the company.

Article 40.- Minutes of meetings of the Members’ Council

1. All meetings of the Members’ Council shall be recorded in the book of minutes of the company.

2. Minutes of each meeting of the Members’ Council shall be completed and approved prior to the closing of the meeting. The minutes must include the following principal contents:

a/ Time and venue of the meeting;

b/ Total number of attending members and the percentage of charter capital they represent;

c/ Agenda;

d/ Summary of statements made at the meeting;

e/ Matters voted upon, results of voting on each matter and decisions passed;

f/ Full name and signature of the Chairman of the Members’ Council or of the person authorized by the Chairman of the Members’ Council to preside over the meeting.

Article 41.- Director (General Director)

1. The Director (General Director) of the company is the person who manages the day-to-day business operation of the company, and who is answerable to the Members’ Council for the exercise of his/her rights and performance of his/her obligations. Where the Charter of the company does not provide for the Chairman of the Members’ Council to be the legal representative, the Director (General Director) shall be the legal representative of the company.

2. The Director (General Director) shall have the following rights:

a/ To organize the implementation of decisions of the Members’ Council;

b/ To decide all matters relating to the day-to-day business operation of the company;

c/ To organize the implementation of the business plans and investment plans of the company;

d/ To issue the regulations on internal management of the company;

e/ To appoint, remove or dismiss management personnel in the company except for those under the competence of the Members’ Council;

f/ To sign contracts in the name of the company, except for those under the competence of the Chairman of the Members’ Council;

g/ To make recommendations regarding the organizational structure of the company;

h/ To submit the final annual financial report to the Members’ Council;

i/ To recommend the plan for use of profits or for dealing with losses in business;

k/ To recruit employees;

l/ Other rights stipulated in the Charter of the company and in the labor contract which the Director (General Director) enters into with the company and in accordance with the decision of the Members’ Council.

3. The Director (General Director) shall have the following obligations:

a/ To exercise his/her delegated rights and perform his/her assigned duties honestly and diligently in the lawful interests of the company;

b/ Not to abuse his/her position and power nor to use assets of the company for personal benefits of his/her own or of other persons; not to disclose secrets of the company except where approved by the Members’ Council;

c/ When the company fails to pay fully all debts and other property obligations which are due and payable, to inform all members and creditors of the company of the financial situation of the company; not to increase salary or to pay bonuses to employees of the company, including managers; to be personally liable for any damage caused to creditors due to failure to perform the obligation stipulated in this Point; and to recommend measures to overcome the financial difficulties of the company;

d/ To perform other obligations stipulated by law and the Charter of the company.

Article 42.- Contracts which must be approved by the Members’ Council

1. All members of a company must be informed of all economic, labor and civil contracts between the company and any of its member, Director (General Director) or any of their related persons no later than fifteen days prior to signing of such contracts.

2. Where a member discovers a sign of personal gains in any contract, he/she may request the Members’ Council to consider and make a decision. In this case, the contract may only be signed after a decision has been made by the Members’ Council. If the contract is signed without prior approval of the Members’ Council, such contract shall be void and be null and dealt with according to law. Persons causing damage to the company must compensate for such damage and return to the company any benefits gained from the performance of such contract.

Article 43.- Increase and reduction of the charter capital

1. By decisions of the Members’ Council, the company may increase its charter capital by way of:

a/ Increasing the contributed capital of members;

b/ Increasing the charter capital relative to the increased value of assets of the company;

c/ Receiving contributed capital from new members.

2. In case of increase of contributed capital of members, the additionally contributed capital shall be divided to each member in proportion to his/her contributed capital share in the charter capital of the company. If a member does not contribute additional capital, such share of capital shall be divided amongst other members in proportion to their respective shares of contributed capital.

3. By decisions of the Members’ Council, the company may reduce its charter capital by way of:

a/ Returning part of the contributed capital to members in proportion to their respective shares of capital in the charter capital of the company;

b/ Reducing the charter capital relative to the reduced value of assets of the company;

The company may only reduce its charter capital in accordance with the provisions in Point a of this Clause if, following such return of contributed capital to the members, the company is still able to pay all debts and other property obligations.

Article 44.- Conditions for distribution of profits

A limited liability company may only distribute profits to its members when it earns profits from its business, has fulfilled its tax and other financial obligations in accordance with the provisions of law, and right after such distribution of profits, the company is still able to pay all due debts and other property obligations.

Article 45.- Recovery of returned shares of contributed capital or distributed profits

Where part of the contributed capital is returned because the charter capital is reduced not in accordance with Clause 3, Article 43 of this Law, or where profits are distributed to members not in accordance with Article 44 of this Law, all members must return to the company the amount of money or other assets they received or shall be jointly liable for a debt equal to the reduced amount of capital or the distributed amount of profits in proportion to their shares of contributed capital.

Section II. ONE-MEMBER LIMITED LIABILITY COMPANIES

Article 46.- One-member limited liability companies

1. A one-member limited liability company is an enterprise owned by one organization (hereinafter referred to as company owner); the owner shall be liable for all debts and other property obligations of the enterprise within the amount of the charter capital of the enterprise.

2. The company owner may assign whole or part of the charter capital of the company to other organizations and/or individuals.

3. One-member limited liability companies shall not be entitled to issue shares.

4. One-member limited liability companies shall have the legal person status from the date they are granted the business registration certificate.

Article 47.- Rights and obligations of a company owner

1. A company owner shall have the following rights:

a/ To decide the contents, amendments and/or supplements to the Charter of the company;

b/ To decide the organizational and managerial structure of the company, to appoint, remove or dismiss management personnel of the company as stipulated in Article 49 of this Law;

c/ To decide adjustments of the charter capital of the company;

d/ To decide investment projects having the value equal to or larger than 50% of the total value of the assets recorded in the accounting books of the company;

e/ To decide sale of assets having the value equal to or larger than 50% of the total value of the assets recorded in the accounting books of the company;

f/ To organize supervision, monitoring and assessment of the business operation of the company;

g/ To make decisions on the use of profits;

h/ To decide the reorganization of the company;

i/ Other rights stipulated in this Law and in the Charter of the company.

2. A company owner shall have the following obligations:

a/ To contribute capital in full and on time as registered;

b/ To comply with the Charter of the company;

c/ To comply with the law provisions on contracts regarding any purchase, sale, borrowing, lending, lease or rent between the company and the owner;

d/ To perform other obligations as prescribed by law.

Article 48.- Restrictions on rights of the company owner

1. The company owner may not directly withdraw a part or the whole of capital already contributed to the company.

2. The company owner may only withdraw capital by way of assigning a part or whole of the capital to other organizations or individuals.

3. The company owner may not withdraw profits of the company when the latter has not fully paid all due debts and other property obligations.

Article 49.- Organizational and managerial structure of the company

1. Depending on the scale and line of business, the organizational and managerial structure of a one-member limited liability company shall comprise the Board of Management and the Director (General Director), or the Chairman of the company and the Director (General Director).

2. Rights and obligations of the Board of Management or the Chairman of the company and of the Director (General Director) of a one-member limited liability company shall be stipulated in the Charter of the company based on this Law and other relevant provisions of law.

Article 50.- Increase and reduction of the charter capital

One-member limited liability companies may increase or reduce their charter capital by way of:

1. Increasing or reducing the capital contributed by the company owner;

2. Adjusting the charter capital corresponding to the value of assets of the company.