Does legal entities subject to criminal liability in Vietnam?

An entity means an organization with distinct legal rights, such as an individual, partnership, or corporation. Legal entities participate in many fields of society nowadays. However, not everyone has a clear understanding of entities with legal status, especially in penal relations. So, in this article, LSX legal firm would like to help you answer the question: “Does legal entities subject to criminal liability in Vietnam?”

Legal grounds

• Civil Code 2015
• Criminal Code 2015

Legal entity under Vietnamese legislation

A legal entity is a term used in law, especially economic law. A collective entity, with independent legal status, established in accordance with the law to enter into legal relations on its own behalf. When signing a legal document made by an organization without legal status, that document does not have validity.
Article 74, Civil Code 2015:

1. An organization shall be recognized as a legal entity if it satisfies all of the following conditions:
   (a) It was established in accordance with provisions of this Code or other relevant laws;
   (b) It has an organizational structure pursuant to article 83 of this Code;
   (c) It has property independent from other individuals and organizations and it is self-responsible by recourse to its property.
   (d) It participates independently in legal relations in its own name.
2. Every individual or legal entity has the right to establish a legal entity, except where otherwise prescribed by law.

The law recognizes both commercial legal entity and non-commercial legal entity, so these two forms have the following characteristics: having a tight organizational structure, assets independent of other organizations and individuals, independently entering into legal relations on their behalf, and naturally eligible to take responsibility for their legal activities.

Do legal entities subject to criminal liability in Vietnam

The Civil Code 1999 does not provide for criminal prosecution of commercial legal entities. However, due to the increasing situation of commercial legal entities taking advantage of this loophole to commit criminal acts, in the Civil Code 2015, legislators have introduced cases where commercial legal entities subject to criminal liability. Specifically, Article 76 of the Civil Code 2015 provides:
Commercial legal entities bear penal liability for crimes specified in one of Articles 188, 189, 190, 191, 192, 193, 194, 195, 196, 200, 203, 209, 210, 211, 213, 216, 217, 225, 226, 227, 232, 234, 235, 237, 238, 239, 242, 243, 244, 245, 246, 300 and 324 of this Code.

33 crimes for which the commercial entity can be criminally prosecuted

According to Article 76 of the Civil Code, commercial legal entities may subject to

• Smuggling;
• Illegal trafficking of goods or money across the border;
• Article Manufacture or trading of banned commodities;
• Storage or transport of banned commodities;
• manufacture or trading of counterfeit foods, foodstuff, or food additives;
• Manufacture of trading of counterfeit medicines for treatment or prevention of diseases;
• Manufacture or trading of counterfeit animal feeds, fertilizers, veterinary medicine, pesticides, plant varieties, animal breeds;
• Hoarding; Tax evasion; Illegal printing, issuance, trading of invoices or receipts;
• Deliberate publishing of false information or concealment of information in securities activities;
• Use of internal information to deal in securities;
• Cornering the stock market;
• Commitment of frauds in insurance business;
• Evasion of social insurance, health insurance, unemployment insurance payment for employees;
• Violations against regulations on competition;
• Infringement of copyrights and relevant rights;
• Infringement of industrial property rights;
• violations against regulations on survey, exploration, and extraction of natural resources;
• Violations against regulations on forest extraction and protection;
• Violations against regulations on management and protection of wild animals;
• Causing environmental pollution;
• Violations against regulations on environmental emergency prevention, response, and relief;
• Violations against regulations on protection of irrigation works, embankments, and works for protection against natural disasters;
• Violations against regulations on protection of river banks;
• Import of wastes into Vietnam’s territory;
• Destruction of aquatic resources; Forest destruction;
• Violations against regulations on management and protection of endangered, rare animals;
• Violations against regulations on management of wildlife sanctuaries;
• Import and spread of invasive alien species;
• Terrorism financing;
• Money laundering.

Conditions for criminal liability of legal entities

Article 75, Civil Code 2015, amended and supplemented in 2017 provides:
Article 75. Conditions for a corporate legal entity to bear criminal responsibility

1. A corporate legal entity shall only bear criminal responsibility when satisfying all of the following conditions:
   a) The criminal offense is committed in the name of the corporate legal entity;
   b) The criminal offense is committed in the interests of the corporate legal entity;
   c) The criminal offense is under instructions or approval of the corporate legal entity;
   d) The time limit for criminal prosecution specified in Clause 2 and Clause 3 Article 27 hereof has not expired.
2. The fact that a corporate legal entity has criminal responsibility does not exempt the criminal responsibility of individuals.

The Civil Code 1999 does not provide for criminal prosecution of commercial legal entities. However, due to the increasing situation of commercial legal entities taking advantage of this loophole to commit criminal acts, in the Civil Code 2015, legislators have introduced cases where commercial legal entities subject to criminal liability. Specifically, Article 76 of the Civil Code 2015 provides:
Commercial legal entities bear penal liability for crimes specified in one of Articles 188, 189, 190, 191, 192, 193, 194, 195, 196, 200, 203, 209, 210, 211, 213, 216, 217, 225, 226, 227, 232, 234, 235, 237, 238, 239, 242, 243, 244, 245, 246, 300 and 324 of this Code.

Types of penalties for legal entities?

Depending on the extent and consequences of the legal entity when committing one of the above offenses, the law provides corresponding penalties. Under Article 33 of the Criminal Code, the main penalties and additional penalties that commercial legal entities must bear when committing crimes are:

Primary sentences: 

• Fine.
• Suspension of operation.
• Permanent shutdown. 

Additional sentences: 

• Prohibition from operating in certain fields.
• Prohibition from raising capital.
• Fine if no administrative penalties are imposed. 

The corporate legal entity shall incur only one primary sentence for a criminal offense committed and possibly one or more additional sentences

Legal service of LSX Legal Firm

LSX legal firm provides legal services to clients in various legal areas. To make your case convenient, LSX will perform:

• Legal advice related to new regulations;
• Representing in drafting and editing documents;
• We commit the papers to be valid, and legal for use in all cases;
• Represent to submit documents, receive results, and hand them over to customers.

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.

Contact LSX

Finally, hope this article is useful for you to answer the question about “Does legal entities subject to criminal liability in Vietnam?”. If you need any further information, please contact  LSX Law firm: +84846175333 or Email: [email protected]

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