What is the organizational structure of a Multi-member LLC in Vietnam?
Organizational structure A limited liability company with two or more members is a collection of different departments, units, and individuals that have a dependent relationship to carry out business tasks of the enterprise. A Multi-member limited liability company is a common form of business today. However, investors have to notice about the structure of a LLC when carrying out the establishment. So, what is the organizational structure of a Multi-member LLC in Vietnam?
Legal ground
- Law on Enterprise 2020
- Decree 01/2021/ND-CP
Organizational structure of a Multi-member LLC
According to Clause 1, Article 54 of the Law on Enterprise 2020; The structure of a limited liability company with two or more members includes:
- Board of members
- Chairman of the Board members
- Director or General Director
A limited liability company with 11 or more members must establish a Control Board. In case there are less than 11 members, the Control Board may be established in accordance with the corporate governance requirements.
The rights, obligations, standards, conditions, and working regime of the Control Board and the Head of the Control Board are stipulated in the company’s charter.
Besides, a state-owned limited liability company with two or more members and a subsidiary of a state-owned enterprise must establish a Control Board; The establishment of the Board of Controllers in other companies shall be decided by themselves.
On the other hand, the Board of Members is the highest decision-making body of the company, including all company members as individuals and authorized representatives of company members as organizations. The company’s charter stipulates the meeting of the Members Board. However, they must convene at least once a year.
The President of the Board Members is a member of the Board Members, elected by the Board Members. The President of the Board Members may concurrently be the Director or General Director of the company.
The director or general director means the person who runs the company’s business operations, takes responsibility before the Board Members for the performance of their rights and obligations.
Procedure for Multi-member LLC establishment
Step 1: Prepare application for business registration
An enterprise registration dossier for a multi-member limited liability company include:
- An application for enterprise registration.
- Company charter
- Copies of legal papers of the legal representative; authorized person; members as individuals; members as organizations. In case the members are foreign organizations/investors, there must be investment registration certificates. Also, copies of legal documents must be consular legalized.
- List of members.
- Authorization document: In case the owner does not directly carry out the procedure.
Step 2: Submit the application
- At the Business Registration Authorities
- Through Post Office
- Submit online
Step 3: carry out procedure after the establishment
- Procedures for Tax, Social insurance, Labor registration.
- Registration of branches, representative offices, and business locations.
- Then, notify the seal sample.
- Register for import and export codes.
- Equally important, assets valuation of contributed capital. Carrying out procedures for transferring registered property ownership; land use rights, unregistered ownership assets.
- Lastly, satisfy and commit to comply with the conditions of the business line.
Does a Multi-member limited liability company have a Board of Directors?
According to Clause 1, Article 153 of the Law on Enterprise 2020: “The Board of Directors is the managerial body of the company and has the right to make decisions on behalf of the company, perform rights and obligations of the company, except the rights and obligations of the GMS.”
Because the Board of Directors is the management body of the Joint-stock company; so a limited liability company with two or more members does not have a Board of Directors. Instead, the highest decision-making body in a Multi-member LLC is the Board of Members.
Article 54. Organizational structure
1. A multiple-member limited liability company shall have a Board of Members, President of the Board of Members, Director/General Director.
LSX legal firm’s service on company establishment
When establishing a company, people must carry out the procedure following the law at the competent business registration authority (under the Law on Enterprise 2020). The process of establishing a business includes many different steps and phases. If you are not familiar with the law, this process may take a lot of time.
With a team of experienced, reputable, and professional consultants; The firm is always ready to support and work with clients to solve legal difficulties.
Furthermore, using our service, you do not need to do the paperwork yourself, We guarantee to help you prepare documents effectively and legally.
Also, you will not have to waste time preparing the application, submitting application, or receiving results. At those stages, we will help you do it smoothly.
After all, LSX provides the service with the desire that customers can experience it the best way. Additionally, we guarantee the cost to be the most suitable and economical for customers.
Related article
The most suitable capital rate to establish a limited liability company (LLC)
Should I open company in Vietnam? Limited Liability/Sole Proprietorship?
Related questions
A limited liability company with 11 or more members must have a Control Board. In case there are less than 11 members, the Control Board may be established in accordance with the corporate governance requirements.
a) Firstly, Decide the company’s annual business plan and development strategy;
b) Secondly, Decide increase or decrease in charter capital, time and method for raising more capital; issuance of bonds;
c) Thirdly, Decide investments in the company’s development projects; solutions for market development, marketing and technology transfer;
d) Fourthly, Approve contracts for borrowing, lending, sale of assets and other contracts prescribed by the company’s charter whose value are 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) Fifthly, 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) Equally important, 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) Next, Ratify annual financial statements, plans for use and distribution of profits or settlement of losses;
h) Decide the company’s organizational structure;
i) Decide establishment of subsidiary companies, branches and representative offices;
k) Revise the company’s charter;
l) Decide reorganization of the company;
m) Decide dissolution or file bankruptcy of the company;
n) Lastly, Other rights and obligations prescribed by Law and the company’s charter.
Contact LSX
Finally, hope this article is useful for you to answer the question about “What is the organizational structure of a Multi-member LLC in Vietnam?”. If you need any further information, please contact LSX Law firm: +84846175333 or Email: [email protected]
Conclusion: So the above is What is the organizational structure of a Multi-member LLC in Vietnam?. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com
