Legal News

[Law] Amendments to the Corporate Law of 2020

2024/10/03

On July 17, 2024, the Ministry of Planning and Investment issued Official Letter No. 5595/BKHDT-QLKTT requesting the ministries to provide input for the development of the revised Enterprise Law. The Ministry is currently reviewing the performance of the 2020 Enterprise Law over the first four years of its implementation and preparing a draft amendment to address the current issues.

It has been pointed out that several provisions of the 2020 Law on Enterprises are not suitable for the current situation and have been requested to be revised. A proposal for revision by the Vietnam Chamber of Commerce and Industry (VCCI) lists 34 issues, with particular attention paid to the following proposals.

■ Proposals to extend the deadline for remittance of capital contributions (currently 90 days from the date of issuance of the Enterprise Registration Certificate (ERC) under the regulations, but this could be extended to 180 days, etc.) so that investors can properly complete the relevant administrative procedures.
■ Proposal to clarify that the remittance of dividends in a two or more person limited liability company should be based on the actual percentage of capital contribution.
■ Introduction of a mechanism to clarify the authority to sign contracts for transactions between two companies when one individual is the legal representative of both companies.

If these amendments are realized, it is highly anticipated that domestic and foreign companies will enjoy a fair and convenient business environment that will further promote the establishment and growth of enterprises.
The revision of the Enterprise Law is still underway and will continue to be refined with input from all quarters. We will continue to update this newsletter as necessary.