7 Compelling Reasons Why You Should Set Up a Joint Stock Company in Vietnam Now

Amid world chaotic situation, Vietnam still appears to be a country with opportunities and growth. It is hard to deny that! If you do not believe, meet with us and we could argue in a peaceful ways.  

For foreign investors looking to make a mark, the question isn’t whether to invest in Vietnam but how to do it effectively.

Among the many options, choosing to set up a Joint Stock Company in Vietnam stands out as one of the most promising paths to success.

Let us discuss the compelling reasons, strategic insights, and essential steps to set up a Joint Stock Company in Vietnam.

Whether you’re a seasoned entrepreneur or exploring your first venture in this dynamic economy, this guide will prepare you to make informed decisions.

7 Compelling Reasons Why You Should Set Up a Joint Stock Company in Vietnam Now

Why Vietnam? A Call to Action

Imagine walking through Hanoi’s vibrant markets or witnessing the sweeping landscapes of Da Nang, or tasting the vibrant of nightlife in Ho Chi Minh City (Saigon as old name). knowing you are part of the force driving Vietnam’s economic success.

Beyond the beauty lies an economic powerhouse, a country that has risen from the shadows to become one of Asia’s fastest-growing economies.

For foreigners who dare to dream big, Vietnam offers more than just profits; it offers purpose, connection, and legacy. By choosing to set up a Joint Stock Company in Vietnam, you align yourself with this narrative of resilience and ambition.

But why to set up a Joint Stock Company in Vietnam? We will uncover the reasons.

The Scalability Advantage: Why JSCs Outshine Other Business Structures

When you set up a Joint Stock Company in Vietnam, you’re not just starting a business, you’re building a foundation for growth. Unlike Limited Liability Companies (LLCs), which are often limited in their ability to raise capital, when you set up a Joint Stock Company in Vietnam, it allows you to issue shares and securities. This capability opens doors to significant capital mobilization, making it ideal for large-scale ventures or businesses with aspirations of going public.

- Unlimited Shareholders: A JSC requires a minimum of three shareholders, with no restriction on the maximum number. This flexibility accommodates a broad range of investors, from individual stakeholders to institutional funds.

- Capital Contribution Without Liability Risks: Shareholders in a JSC are only liable for debts and obligations to the extent of their capital contributions, ensuring their personal assets remain protected.

Fundraising Flexibility: The Power of Issuing Shares

One of the standout reasons to set up a Joint Stock Company in Vietnam is its unparalleled fundraising potential. JSCs can issue all types of securities, including shares, bonds, and convertible securities. This feature provides a competitive edge in attracting both domestic and foreign investment.

For foreign investors, this capability means you can secure funds from global markets while enjoying the benefits of Vietnam’s cost-competitive environment. Public companies can also raise additional funds through initial public offerings (IPOs), an opportunity exclusive to JSCs.

Strategic Access to Vietnam’s Stock Market

If your vision involves joining the ranks of publicly traded companies, you must set up a Joint Stock Company in Vietnam. Under Vietnamese law, only JSCs can be listed on the country’s stock exchanges. This strategic advantage enables businesses to access liquidity and enhance their reputation in the market.

However, listing a JSC requires compliance with specific criteria, such as maintaining a minimum charter capital and adhering to transparent governance practices. While these requirements may seem stringent, they ultimately bolster investor confidence and open avenues for long-term growth.

Regulatory Structure: Balancing Complexity with Opportunity

The legal framework governing JSCs in Vietnam is robust and well-defined under the Law on Enterprises. While setting up a Joint Stock Company in Vietnam involves a more complex governance structure than an LLC, this complexity also brings transparency and accountability.

A JSC’s management system includes:

- A Board of Directors: Responsible for strategic decision-making.

- A Supervisory Board (for certain companies): Ensures compliance and fairness in operations.

- Annual Shareholder Meetings: Provide a platform for shareholders to influence the company’s direction.

This governance structure aligns with global best practices, making JSCs an attractive choice for foreign investors who value transparency.

Cultural and Economic Fit: Thriving in Vietnam’s Business Environment

Vietnamese culture deeply values trust, collaboration, and long-term relationships. Setting up a Joint Stock Company in Vietnam allows foreign investors to embrace these values while benefiting from the country’s open-door policies.

- Collaborative Nature of JSCs: The shareholder model resonates with Vietnam’s emphasis on collective decision-making.

- Trust-Building Opportunities: A well-structured JSC fosters trust among partners, clients, and local stakeholders, essential for long-term success in Vietnam.

Moreover, Vietnam’s economy is booming, with a young workforce, increasing consumer spending, and strategic trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). A JSC positions you to leverage these dynamics effectively.

Competitive Edge Over Limited Liability Companies

While LLCs are simpler to manage, they lack the fundraising flexibility and growth potential of a JSC. Here’s a quick comparison:

Feature	JSC	LLC
Minimum Shareholders	3	1-50
Fundraising Capability	Can issue shares and securities	Limited
Stock Exchange Listing	Eligible	Not Eligible
Management Complexity	High	Moderate

For businesses targeting regional expansion or significant capital investments, the decision to set up a Joint Stock Company in Vietnam becomes clear.

Practical Tips for Foreigners: How to Succeed in Vietnam

As a foreigner looking to set up a Joint Stock Company in Vietnam, preparation is key. Here’s how you can ensure a smooth process:

Due Diligence on Partners

Finding reliable partners is critical. Conduct background checks on prospective shareholders and gather publicly available company information to mitigate risks.

Understand Local Laws and Regulations

Vietnam’s business laws are detailed, and compliance is non-negotiable. Seek legal counsel to navigate requirements such as:

- Minimum capital requirements

- Shareholder agreements

- Tax obligations

Leverage Local Expertise

Partnering with a reputable local consultant or legal team can save time, reduce risks, and ensure you meet all regulatory obligations.

Steps to Set Up a Joint Stock Company in Vietnam

1. Prepare Legal Documents: This includes the company charter, shareholder list, and business registration application.

2. Register the Business: Submit documents to the Department of Planning and Investment (DPI).

3. Obtain Tax Codes: Register for tax identification numbers and comply with financial reporting requirements.

4. Open a Bank Account: Deposit the initial charter capital into a corporate bank account.

5. Declare Capital Contribution: Ensure shareholders contribute their pledged capital within 90 days of registration.

Final Thoughts: A Strategic Move for Visionary Investors

Vietnam’s rise as a global economic hub is no coincidence. Its strategic location, skilled workforce, and investor-friendly policies make it a land of opportunities. For foreign investors ready to tap into this potential, choosing to set up a Joint Stock Company in Vietnam offers unmatched advantages.

Not only does this structure provide the scalability, fundraising potential, and legal protections needed for long-term success, but it also aligns with Vietnam’s cultural and economic landscape. However, success requires preparation, trust-building, and strategic decision-making.

So, if you’re ready to take the leap, don’t wait. The time to set up a Joint Stock Company in Vietnam is now.

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How to Start a Business in Vietnam?

Why to start a business in Vietnam?

In recent years, Vietnam has become an attractive destination for foreign investment thanks to its advantages of security, political stability, and favorable geographical position to trade with the world. This is both the connection center of the region and the gateway to penetrate the economies in the western region of the Indochina Peninsula. In addition, the Vietnam government has increasingly been offering more preferential policies to create favorable conditions for foreign investors to start doing business in Vietnam.

What to consider to start a business in Vietnam?

To start a business in Vietnam, investors first need to choose for themselves an appropriate type of business based on the number of capital contributors, the amount of capital contributed, and the business’s purse.

According to the provisions of Vietnam law, foreign individuals and organizations can establish a limited liability company or a joint stock company or a partnership or a private enterprise.

The next issue that needs to be considered is the business line.

In order for the company to be able to operate, the company must register the appropriate business lines, related to business activities.

If the selected line of business does not require conditions, the enterprise can go into operation after the establishment of the company. This is considered non-conditional business area which most of company would do.

However, if the investor chooses a conditional business line to do business, the enterprise must meet the necessary requirements, apply for a business license as prescribed, and then go into operation. This is considered conditional investment area where there are some restrictions being required license, minimum charter capital, foreign ownership ratio…

Investors also need to choose a location for their business, which is legally allowed to conduct business activities. The company address must be located in the territory of Vietnam, and comply with requirement corresponding to purpose of business i.e. company address can not be in an apartment building or a dormitory for living purposes only; factory location has to be at proper zone for industrial purpose…

In order to serve the management of the State and facilitate business activities, newly established businesses need to have their own name and this proper name must be unique, not be the same or similar to previously registered businesses.

Enterprises are not allowed to use the names of functional agencies, state management agencies to name the company. The name of the business must include the type of company and proper name.

To avoid duplication with other companies, businesses can use abbreviations or English names, but must ensure that the company name will not cause confusion, without adding prefixes, suffixes or cultural symbols in the name of the business.

The investors need to apply for an Investment Registration Certificate at a competent authority in Vietnam. This is a mandatory procedure for all projects that want to establish a new legal entity in Vietnam.

The processing time for an investment certificate application is around 30 days depending on the specific project. After being granted an Investment Registration Certificate, foreign individuals and organizations need to prepare an application for an Enterprise Registration Certificate at the Department of Planning and Investment which would take around 7 days. Completing this procedure, the enterprise has the legal status according to the provisions of the Law on Enterprises of Vietnam.

From day one since commencing its operation, the company could by itself or hire professional to assist with monthly compliance service i.e., submit foreign labour reports, submit investment report, submit tax report, submit health and insurance reports to authorities to avoid encountering penalties.

ANT Lawyers – a law firm in Vietnam will always follow up with authorities for legal update on matters relevant to investment registration or doing business in Vietnam.

Readmore: https://antlawyers.vn/library/how-to-start-a-business-in-vietnam.html

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Set up Representative Office in Vietnam

 

ANT Consulting offers service to set up representative office in Vietnam for foreign traders whom wish to learn about Vietnam markets and make investment

A foreign business entity or a foreign trader is allowed to establish Representative Office in Vietnam.

Representative office of a foreign business entity in Vietnam (referred as “Representative Office”) means a subsidiary unit of the foreign business entity, established in accordance with the law of Vietnam in order to survey markets and to undertake a number of commercial enhancement activities permitted by the law of Vietnam.

Representative Office will need to apply and obtain the establishment license; and have a seal bearing the name of the representative office.

Representative Office is not allowed to directly conduct profit making activities in Vietnam (i.e: the execution of contracts, direct payment or receipt of funds, sale or purchase of goods, or provision of services), but the representative Office is permitted to

To operate strictly in accordance with the purposes, scope and duration stated in the license for establishment of such representative office;

To rent offices and to lease or purchase the equipment and facilities necessary for the operation of the Representative Office;

To recruit Vietnamese and foreign employees to work for the Representative Office in accordance with the law of Vietnam;

To open accounts in foreign currency and in Vietnamese Dong sourced from foreign currency at banks which are licensed to operate in Vietnam, and to use such accounts solely for the operation of the Representative Office.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

Read more: https://www.antconsult.vn/news/set-up-representative-office-in-vietnam.html

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Notable Changes of Vietnam Law on Enterprises | ANT Lawyers

 On November 26th, 2014, the new version of Law on Enterprises has been adopted by Vietnam’s National Assembly. The act will come into effect on July 1st, 2015 and replace Law on Enterprises 2005. It comprises 10 chapters and 213 articles, which seek to improve Vietnamese business environment. Key points of the amendment include.

Company seals will be made optional

Pursuant to the prior Law on Enterprise, the Gorvernment shall stipulate the content of seals, conditions for making seals and regulations on seals usage. Now this regulation has changed under the new law. According to Article 44 of the new law, the company shall be entitled to decide the design, number and content of seals. The seals must supply the following information:

– Name of the company

– Tax number of the company Before using, the company must supply the seal sample to business registration office to post on National Portal of Business registration. The usage of seals must be in conformity with the company’s bylaw. Seals shall be used in case stipulated by law or agreed between transactional party.

Limited company, joint-stock company may have more than one representatives

Article 13 of the law states that limited company or joint-stock company may have one or many representatives. The number of representatives, titles, rights and obligations of each representative are set out by the company’s bylaw. The company must ensure that at least one representative lives in Vietnam and that representative, if leaving Vietnam, must authorize another person in writing to perform on behalf of him.

The director or general director of joint-stock company will not be prohibited being concurrently the director or general director of another enterprise

Under the Law on Enterprises 2005, the director or general director of the company cannot be concurrently the director or general director of another enterprise. This regulation has been removed by the new amendment. The only exception is the one who is appointed by the state as owner representatives of state capital portions in state-invested enterprises.

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Enterprise establishment service in Vietnam | ANT Lawyers

  ANT Lawyers provides enterprise establishment consulting service for domestic and foreign customers as the following services:

• To consult to establish Joint Stock Company;

• To consult to establish One member Limited liability company;

• To consult to establish Limited liability Company with Two or more members;

• To consult to establish Partnership company;

• To consult to establish Private enterprises;

• To consult to establish Sole trader;

• To consult to establish foreign invested company;

• To consult to establish the parent company, corporations.

Customers procedures established in the ANT Lawyers will enjoy some preferential services such as:

1. Contents of enterprise establishment consulting service:

• To consult legal regulation related to the establishment, operation and management of enterprises;

• To consult to set up personnel structure of the company;

• To consult to select types of enterprises;

• To consult to choose the name of company (lookup and select the appropriate name as the request of customers);

• To consult about the head office of the enterprise;

• To consult on capital, legal capital, investment capital;

• To consult on business lines (lines requires legal capital , professional certification or other conditions);

• To draft legal dossiers for setting up the company  (Request for business registration, charter, founders list and other documents as prescribed by law);

• To consult for business on tax issues, financial obligations after the enterprise have been established and the process of production and business activities;

2. Our tasks in the enterprise establishment services:

ANTLawyers will on behalf of clients to perform the following tasks:

• Drafting and preparation the enterprise establishment dossier as regulations;

• To apply the dossier for business and tax codes registration in the Department of Planning and Investment;

• To monitor progress and inform regularly results to clients;

• To obtain the Investment Certificate from the DPI;

• Filing and registration the seal for Company at the Police Department;

• To obtain the seal and the certificate of the seal for the Company at the Police Department;

• To guide the customers to follow procedures in the relevant state authority (as needed);

3. Documents required to provide by clients:

• Information requested form of business;

• A copy of ID / passport of members / founding shareholder who is individual (notarized);

• A copy of business registration / establishment decisions of members / founding shareholders who is organization.

4. Client’s benefits after establishment:

• To be consulted and offered free the activating annual  tax dossier, records and procedures for billing the enterprise;

• To consult the necessary tasks  of the new enterprise;

• To consult human resources management  , provide free labor contracts and the forms of management personnel;

• To consult the procedures for salary scale registration, the social insurance registration of company;

• To consult on tax matters, tax refund, tax credit;

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Set up representative office in Viet Nam | ANT Consulting

 ANT Consulting offers service to set up representative office in Vietnam for foreign traders whom wish to learn about Vietnam markets and make investment

A foreign business entity or a foreign trader is allowed to establish Representative Office in Vietnam.

Representative office of a foreign business entity in Vietnam (referred as “Representative Office”) means a subsidiary unit of the foreign business entity, established in accordance with the law of Vietnam in order to survey markets and to undertake a number of commercial enhancement activities permitted by the law of Vietnam.

Representative Office will need to apply and obtain the establishment license; and have a seal bearing the name of the representative office.

Representative Office is not allowed to directly conduct profit making activities in Vietnam (i.e: the execution of contracts, direct payment or receipt of funds, sale or purchase of goods, or provision of services), but the representative Office is permitted to

- To operate strictly in accordance with the purposes, scope and duration stated in the license for establishment of such representative office;

- To rent offices and to lease or purchase the equipment and facilities necessary for the operation of the Representative Office;

- To recruit Vietnamese and foreign employees to work for the Representative Office in accordance with the law of Vietnam;

- To open accounts in foreign currency and in Vietnamese Dong sourced from foreign currency at banks which are licensed to operate in Vietnam, and to use such accounts solely for the operation of the Representative Office.

Finding the right business partner in Vietnam is also important. We recommend doing research on the reputation of the company and individual shareholders, corporate or individual, gathering publicly available company information, and performing background checks on key personnel to find potential risks in cooperation. Working with a reliable partner can help achieve economic benefits, saving time and money in business.

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How to Transfer Shares in a Joint Stock Company? | ANT Lawyers

According to Vietnam law, joint stock company is one form of typical company types in Vietnam. For a joint stock company to be set-up, there should be at least three shareholders. In the joint stock company, the charter capital is divided into equal parts called shares. Shareholders have the right to freely transfer their shares to others, but there will be some certain restrictions.

Within three years from the establishment of the company and the issuance date of the Certificate of Enterprise Registration, the ordinary shares of founding shareholders may be transferred to other founding shareholders and may only be transferred to a person that is not a founding shareholder if the transfer is accepted by the General Meeting of Shareholders. In this case, the transferor does not have the right to vote on this transfer. In addition, if the company’s charter has provisions restricting the transfer of shares, the transfer of shareholders must also comply with the provisions of the Charter and these regulations will only applicable if they are written in the certificates of the shares subject to restriction.

The transfer of shares is usually made by the parties by contract or transaction on the securities market. In case of transfer under a contract, the documents shall bear the signatures of the transferor and the transferee or their authorized representatives. In case shares are transferred on the securities market, the transfer procedures prescribed by securities laws shall apply.

Shareholders of a joint-stock company have the right to donate part or all of their shares in the company to other individuals or organizations; use shares to pay off debt. At that time, individuals and organizations that are given or received the donation or debt payment will become a shareholder of the company. However, they will only become shareholders of the company from the time their information is fully recorded in the register of shareholders.

In case of the death of a shareholder that is an individual, his/her heir at law or designated by a will shall become a shareholder of the company. If such shareholder dies without an heir or the heir refuses the inheritance or is disinherited, his/her shares shall be settled in accordance with civil laws.

The last point to pay attention is when there is a share transfer event, the company shall register the changes of shareholders in the shareholder register as requested by relevant shareholders within 24 hours after the request is received.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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Enterprise establishment service in Vietnam | ANT Lawyers

  ANT Lawyers provides enterprise establishment consulting service for domestic and foreign customers as the following services:

- To consult to establish Joint Stock Company;

- To consult to establish One member Limited liability company;

- To consult to establish Limited liability Company with Two or more members;

- To consult to establish Partnership company;

- To consult to establish Private enterprises;

- To consult to establish Sole trader;

- To consult to establish foreign invested company;

- To consult to establish the parent company, corporations.

Customers procedures established in the ANT Lawyers will enjoy some preferential services such as:

1. Contents of enterprise establishment consulting service:

- To consult legal regulation related to the establishment, operation and management of enterprises;

- To consult to set up personnel structure of the company;

- To consult to select types of enterprises;

- To consult to choose the name of company (lookup and select the appropriate name as the request of customers);

- To consult about the head office of the enterprise;

- To consult on capital, legal capital, investment capital;

- To consult on business lines (lines requires legal capital , professional certification or other conditions);

- To draft legal dossiers for setting up the company (Request for business registration, charter, founders list and other documents as prescribed by law);

- To consult for business on tax issues, financial obligations after the enterprise have been established and the process of production and business activities;

2. Our tasks in the enterprise establishment services:

ANTLawyers will on behalf of clients to perform the following tasks:

Drafting and preparation the enterprise establishment dossier as regulations;

- To apply the dossier for business and tax codes registration in the Department of Planning and Investment;

- To monitor progress and inform regularly results to clients;

- To obtain the Investment Certificate from the DPI;

- Filing and registration the seal for Company at the Police Department;

- To obtain the seal and the certificate of the seal for the Company at the Police Department;

- To guide the customers to follow procedures in the relevant state authority (as needed);

3. Documents required to provide by clients:

- Information requested form of business;

- A copy of ID / passport of members / founding shareholder who is individual (notarized);

- A copy of business registration / establishment decisions of members / founding shareholders who is organization.

4. Client’s benefits after establishment:

- To be consulted and offered free the activating annual tax dossier, records and procedures for billing the enterprise;

- To consult the necessary tasks of the new enterprise;

- To consult human resources management , provide free labor contracts and the forms of management personnel;

- To consult the procedures for salary scale registration, the social insurance registration of company;

- To consult on tax matters, tax refund, tax credit;

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What Rights Shareholder Holds in Joint Stock Company? | ANT Lawyers

Shareholders are individual or organization that owns at least one share of the joint-stock company and also are owner of the joint-stock company. Along with these roles, their interests are tied to business operations although they may not directly manage the day-to-day company affairs. In order to implement governance, the powers and responsibilities of each interest group such as shareholders, the board of directors, managerial personnel, etc. should be assigned based on the statutory principles and procedures.

According to the regulations on shareholders in the Law on Enterprise 2020, the rights of shareholders can be categorized into the following groups: economic rights, governance rights, information rights, and litigation rights.

Economic rights

Economic right is the right to gain all pecuniary interest with respect to the shares. The purpose of starting a business or investing in securities comes mainly from earning income or gaining profits. Economic rights accordingly include:

-Right to entitlement to dividends

-Right to transfer ownership

-Priority right to acquire the newly issued shares

-Right to entitlement to a portion of the assets after dissolution or bankrupt

-Appraisal Right

Among these above rights, right to entitlement to dividends and right to transfer ownership are the fundamental economic rights of a shareholder.

Dividend of common shares is determined according to the realized net profit and the dividend payment from the company’s retained earnings. Despite right to entitlement to dividends, shareholders are still subject to a number of limitations in law and in fact. Dividend entitlement is determined by the General Meeting of Shareholders based on the recommendation of the Board of Directors, after the company has fulfilled tax obligations and other financial obligations, contributed to reserve fund, paid for previous losses and met the solvency for all due debts and other property obligations. Dividend is not required to be distributed annually. Depending on the business situation, the General Meeting of Shareholders may decide to retain profits for reinvestment.

Besides dividend entitlement from the company’s operating results, shareholders can also gain profits by share transfer. This kind of investment is popular with respect of shares or securities of public companies, investors do not aim for corporate governance rights as well as dividend, they intend to earn benefits by the difference of the market values of stocks, especially when the stock value increases.

Governance rights

Modern corporate governance has two principles, one is to separate ownership and governance and to separate governance and management. It means that the major shareholders should not hold senior managerial positions in the company and Chairperson of the Board of Directors should not be assigned to other senior managerial positions such as General Director and/or Director.

Shareholders may be an individual or organization which they have their own different interests, goals and abilities. The separation between ownership and management makes the situation of whom the owner is and how the share get transferred not to affect the business operation. In the meantime, the separation helps gather professional managers to implement target intended by the company. According to the laws, members of the Board of Directors of a public company concurrently holding several executive titles must be reduced to the minimum to ensure the independence of the Board of Directors, specially the Chairperson of the Board of Directors shall not be the Director/General Director in a public company as of August 1st, 2020. There are no similar rules applicable to joint stock companies which are not public company.

Attendance, speaking and voting at General Meeting of Shareholders are fundamental in governance right of common shareholders, applicable to all shareholders holding at least one share. ty. In principle, being a shareholder who holds shares of the company regardless of the number has equal rights to attend and vote at the General Meeting of Shareholders. By the General Meeting of Shareholders, the shareholders holding a certain number of shares can impact decisions on some matters such as election, dismissal, and removal of members of the Board of Directors and Controllers, amendment and supplementation of internal documents, major transactions, and others as stipulated in law on enterprise or charter. In addition to the above rights, the majority shareholders also have a number of other rights related to governance as follows:

The shareholder or group of shareholders holding at least 5% of the total number of common shares (charter may require a smaller percentage) is entitled to:

-Call a General Meeting of Shareholders

-Request Board of Controllers to inspect each specific matter relating to management, governance of company affairs if necessary

-Recommend matters to be included in agenda of General Meeting of Shareholders

-The shareholder or group of shareholders holding at least 10% of the total number of common shares (charter may require a smaller percentage) is entitled to nominate candidates for the Board of Directors, Board of Controllers

Information rights

Shareholders have the right to access documents and information of the company. In addition to the basic documents such as the charter, list of shareholders, meeting minutes and resolutions of the General Meeting of Shareholders, shareholders have the right to access to reports related to the business affairs.

However, some information is only reviewed by shareholders who own required percentage of share:

-Access and extract information on full name and contact address as specified in list of shareholders having voting right and list of shareholders having right to attend General Meeting of Shareholder; request to adjust his/her inaccurate information

-Access, extract and scan charter of company, meeting minutes of General Meeting of Shareholder and its resolution

-Access, extract and copy partial or whole list of involved persons and their contracts, transaction of which the company is other party, interests of Board of Directors, Controllers, Directors or General Directors and other managerial positions of company

-Access and extract minutes and resolutions of Board of Directors, annual or mid-year financial reports, reports of Board of Controllers, contracts and transaction approved by Board of Directors and other documents, excepting for documents related to company’s know-how and trade secrets (applicable to shareholder and group of shareholders who own at least 5% of total number of common shares, the charter may require a smaller percentage)

-Access profit and loss statements, financial reports, governance and management assessment reports; inspection reports of Board of Controllers (applicable to shareholder who own shares at least 1 consecutive year, the charter may require a smaller percentage)

Different to common joint stock company, a public company must announce fully, accurately and promptly the periodic and extraordinary information on business, finance and governance. Other information must be announced if it influences share price and investment decisions of shareholders and investors.

Litigation rights

The Law on Enterprises has provided a mechanism to request the Court or Arbitration to rescind the resolution of the General Meeting of Shareholders or sue the managerial personnels when they fail to fully and properly implement their tasks, including:

The shareholder or group of shareholders holding at least 5% of the total number of common shares (charter may require a smaller percentage) is entitled to:

-Request to rescind resolutions of the General Meeting of Shareholders when the orders and procedures of calling the meeting and making resolution of the General Meeting of Shareholders seriously violate the regulations of the Law on Enterprises and company’s charter

-However, the resolution of the General Meeting of Shareholders adopted by 100% of the total number of voting shares is legal and effective even when the orders and procedures of calling the meeting and adopting such resolution violates regulations of the Law on Enterprises and company’s charter.

-Request to rescind resolutions of the General Meeting of Shareholders when its provisions violates the laws or company’s charter

-The shareholder, group of shareholders holding at least 1% of the total number of common shares is entitled to:

-Sue members of Board of Directors, Directors, General Directors separately or jointly under certain circumstances

The Chairperson of Board of Directors or the Director or General Director usually acts as the legal representative of the company, representing the company to perform rights and obligations arising from the company’s transactions, representing the company to take proceedings before the court or arbitrator. However, when their interests conflict with those of the shareholders, shareholders have the right to initiate a lawsuit claiming benefits or compensation. The Law on Enterprise also permits shareholders to sue on behalf of the company when the above managerial personnels commit violations, causing damage directly to the company and indirectly to shareholders.

Not all shareholders have the right to sue for the above managerial personnels, only those who own at least 1% of the total number of common shares. This restriction makes sense with respect of public companies, in order to eliminate unfair competition actions conducted by minority shareholders who is controlled by the rival companies because amount of 1% in public company is not a small number.

Similar to a lawsuit against a manager, shareholder or group of shareholders is also required to own at least 5% of the total number of common shares to request rescission of the resolution of the General Meeting of Shareholders if there is violation on substantive law and procedural law. Accordingly, all resolutions of the General Meeting of Shareholders violating the substantive laws or the company’s charter are rescinded at the request of shareholders, but only serious procedural violations may be rescinded. There is no specific instructions for serious procedural violations at this time, the assessment will depend on personal perspective of the court and arbitrator.

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