- June 22, 2021
- Posted by: GBS
- Categories: Business, Legal
A limited liability company is an enterprise that has legal person status, starting from the date of issuance of its business registration certificate. As such, the owners of the limited liability company and the limited liability company are separate legal entities: in a court of law, the company is a legal person and its owners are natural persons, with rights and obligations in respect of their ownership of the enterprise.
How many types of limited liability company forms are there?
There are 2 types of limited liability company forms:
- Limited liability company with more than one member
- Limited liability company with one (sole) member
Who are the members of a limited liability company?
In the context of the limited liability company, owners are called members. In both forms of limited liability companies (with more than 1 member or with 1 member), members may be an organization and/or an individual. For example, in a limited liability company with more than 1 member, the members (owners) may be two or more organizations, or a number of organizations and individuals, or a number of individuals. In the case of a limited liability with 1 member, the owner (member) may be either an individual or an organization.
Is there a restriction on the number of members of a limited liability company?
Yes, the total number of members of a limited liability company may not exceed 50 legal or natural persons.
What is the financial liability of the members of a limited liability company?
- Members of a limited liability company are responsible for the debts and other liabilities of the enterprise within the amount of capital that they committed to contribute to the enterprise (company).
- The limitation on the liability of the owners/members of a limited liability company makes this form of enterprise attractive for investors, because their ownership of this type of a company does not have an effect on their personal assets in case the business fails.
Can a limited liability company issue shares to the public?
No, a limited liability company is not entitled to issue shares to the public. This right is reserved for shareholding companies.
Who is responsible for the management of a Limited Liability Company?
A limited liability company is managed by the Members’ Council. The Members’ Council elects a member to act as the Chairman of the Members’ Council. The Chairman may act as the director or director general of the limited liability company, simultaneously. The Chairman may also be the legal representative of the limited liability company, if this provision is stipulated in the company charter.
What about seal, branches, representative offices and business locations of a Limited Liability Company?
A limited liability company has the right to make and use a seal for its business. Please study the requirements for obtaining a seal-engraving permit on this Portal.
There are no limitations on the number of business locations, branches and representative offices a limited liability company may have. Please study Government Decree 88/2006/ND-CP, dated 29 August 2006 on business registration and the Circular No. 03/2006/TT-BKH dated 19 October 2006 or contact us at: firstname.lastname@example.org to learn more about how to register branches, representative offices and additional business locations.
Where do we apply to register a Limited Liability Company?
You need to apply to the Provincial Business Registration Office under the Department of Planning and Investment in the province where you plan to locate the head office of your business, after completing all the documents for business registration.
Which documents do we need to complete when we register a Limited Liability Company?
- Application form for registering a Limited Liability Company. You can obtain this form from the Business Registration Office or from GBS
- Draft of the company charter, this can be done by GBS
- List of members, attached with: a) Copies of the identification cards, passports or other relevant personal certification of members that are natural persons (individuals); b) Copy of a decision of establishment, certificate of business registration or other relevant certification of the institutional members (other legal persons such as enterprises or other authorized agencies such as those that belong to government and are authorized to be a member of a limited liability company) and copy of the identification card, passport or other relevant personal certification of the authorized representative of the institutional members. If such institutional members are foreign entities, their documents must be certified by competent agencies where they are established and such certification should not be older than 3 months from the date of submission of application dossiers.
- Certification of legal capital issued by the competent organization for enterprise that is going to operate in a business line where legal capital is required.
- Valid copy of the practice certificate of the general partners or another individual(s) in a business line where such a certificate is required.
What kinds of documents are accepted as legally valid personal identification of members that are individuals?
- Valid personal ID card or passport for Vietnamese citizens resident in Vietnam
- One of the following papers that are valid for overseas Vietnamese:
- Vietnamese passport
- Foreign passports (or papers that can replace the foreign passport) and one of the following papers that are valid:
- Certificate of Vietnamese nationality
- Certificate of losing Vietnamese nationality
- Certificate of citizen registration
- Certificate of Vietnamese origin
- Certificate of having Vietnamese origin
- Certificate of having Vietnamese blood relations
- Other papers as regulated by laws
- Valid Resident Card issued by a Vietnamese competent authority and passport for foreigners residing in Vietnam
- Valid passport for foreigners not residing in Vietnam.
What kind of information is provided in the application dossier when registering a Limited Liability Company?
Limited liability companies are registered by the legal representative of the company. Who would act as the legal representative of the company must be indicated in the company charter.
During registration, the following information must be submitted:
- Name, ethnicity, nationality, birth date and gender, the number of personal ID card or other personal identification papers, name of issuing authority for personal ID card and date of issue, registered address of the household book, current residence address, telephone, fax, e-mail or website, if applicable, of the legal representative and the members who are individuals
- Business registration certificate or establishment decision and address of head office of institutional members
- Name of the enterprise in Vietnamese, and in foreign language or the abbreviated name of enterprise, if applicable
- Head office address, telephone, fax, and e-mail, website, if applicable
- Business lines according to Vietnam Standard Industrial Classification (VSIC)
- Registered capital (also called charter capital);
- Legal capital, if the business line(s) require so.
- Name and address of branch, if applicable
- Name and address of representative office, if applicable
- Name and address of business location(s), if applicable
- Signature of the legal representative
- The list of members must show the amount of capital contributions by each member, the type and value of assets towards the capital contribution as well as the timing when such capital would be contributed. Members must sign this list and submit it together with draft charter of the company.
Do we need to give a name to the Limited Liability Company?
Yes, every enterprise, including limited liability companies, must have a name.
Are there rules when naming an Enterprise?
Yes. Please study carefully Chapter III, Articles 10-13 of Government Decree 88/2006/ND-CP, dated 29 August 2006 on business registration and Articles 31-34 of the Enterprise Law to learn more about how to name your enterprise.
According to the Enterprise Law and Government Decree 88/2006, names of enterprises must not overlap or be confused with the name of another enterprise registered in the same business line within the same province or city directly under the Central Government. Therefore, you are required to check the registered names of all enterprises currently in operation in the archive of the Business Registration Office of the province where you intend to locate your head office. If the name you choose overlaps with an already registered enterprise name, your application would be rejected.
How long does it take to register an Enterprise?
The statutory time limit for the issuance of business registration certificate is 10 working days, from the date of the submission of a fully valid application dossier.
When you submit your application dossier, the business registration office will give you a receipt slip that shows your application date. If the contents of your dossier do not fully comply with the regulations, the registry has to inform you to modify or supplement your application dossier within 10 working days in writing. In this notification, the registry has to clearly indicate what you have to modify or supplement.
Which regulations apply to the registration of an Enterprise?
Enterprise Law, Government Decree 88/2006/ND-CP dated 29 August 2006 on Business Registration and the Circular No. 03/2006/TT-BKH dated 19 October 2006 on the implementing regulations of the Government Decree 88/2006/ND-CP on Business Registration.
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