OBJECTS NOT PERMITTED TO ESTABLISH ENTERPRISES?

Organizations and individuals have the right to establish and manage enterprises in Vietnam. The State recognizes and protects property ownership, investment capital, income, and other legal rights and interests of enterprises and enterprises owners. However, to ensure the ability to mornitor enterprises effectively, those wishing to establish enterprises need to meet legal requirements. So, what are these conditions according to current regulations, and who are the objects not permitted to establish enterprises?

Basic conditions for objects to establish enterprises

Objects wishing to establish enterprises need to meet the following requirements:

– Age;

– Legal capacity;

– Financial capacity;

– Not banned from doing business due to violating the law;

– Not prohibited or restricted by special laws.

Organizations and individuals that do not satisfy the above conditions will be subjected to the case of objects not permitted to establish enterprises.

Objects not permitted to establish enterprises

The following organizations and individuals do not have the right to establish and manage enterprises in Vietnam:

– State authorities, People’s armed forces using state-owned assets to establish enterprises to serve their own interests;

– Officials and public employees defined by the Law on Officials and the Law on Public Employees;

– Commissioned officers, non-commissioned officers, career military personnel, military workers and public employees in agencies and units of Vietnam People’s Army; commissioned officers, non-commissioned officers and police workers in police authorities and units, except for those designated and authorized representatives to manage state-owned stakes in enterprises or to manage state-owned enterprises;

– Executive officers and managers of state-owned enterprises;

– Minors; people with limited legal capacity; incapacitated people; people having difficulties controlling their behaviors; organizations that are not juridical persons;

– People who are facing criminal prosecution, kept in temporary detention, serving an imprisonment sentence, serving an administrative penalty in a correctional institution or rehabilitation center, has limited legal capacity or is incapacitated, is not able to control his/her own behaviors, is banned by the court from holding certain positions or doing certain works; other cases prescribed by Laws;

– Juridical persons that are banned from business operation or banned from certain fields.

>> VALUATION OF CONTRIBUTED ASSETS INTO A COMPANY https://linconlaw.vn/valuation-of-contributed-assets-into-a-company/

>> PROCEDURES ON CAPITAL INCREASE OF MULTIPLE-MEMBER LIMITED LIABILITY COMPANY https://linconlaw.vn/procedures-on-capital-increase-of-multiple-member-limited-liability-company/

Objects not permitted to contribute capital or buy shares in the enterprises

Beside the above-mentioned case, organizations and individuals have the right to contribute capital, buy shares and stakes of joint stock companies, limited liability companies and partnerships as follow:

– State authorities, People’s armed forces contributing state-owned assets to enterprises to serve their own interests;

– The entities that are not allowed to contribute capital to enterprises.

Handling cases where enterprises are established by bbjects not permitted to establish enterprises

enterprises are established by objects not permitted to establish enterprises may be revoked the Enterprise Registration Certificate.