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Charter of a single member limited liability company in Vietnam:

THE SOCIALIST REPUBLIC OF VIETNAM

Independence - Freedom- Happiness

CHARTER

ONE MEMBER LIMITED LIABILITY COMPANY

... 

Name of the company owner (write in capital letters): ...

Employer Identification Number (Federal tax code): ...

Issued by ... ; Date of issuance: ... 

Head office’s address: ...

Telephone: ...    Fax: ...                     

Email: ...    Website: ... 

Today decides to establish One member limited liability company Vietnam ... (hereinafter referred to as company) operates in accordance with the Law on Enterprise No. 68/2014/QH13 dated November 26, 2014 (hereinafter referred to as the Law on Enterprise) and this Charter with the following articles:

CHAPTER I

GENERAL PROVISIONS

Article 1. Scope of responsibilities

The Company Owner shall be liable for all debts and other property obligations of the Company within the amount of the charter capital of the Company.

Article 2. Name of the Enterprise

Name of the company (in Vietnamese): ...

Transaction name (in English): ...

Abbreviated name: ...

Article 3. Head office’s address of the company.

Head office is located at ...

Article 4. Scope of business 

...

Article 5. Operation term 

 1. The Company’s term is ... years since the date of its Investment Licence in accordance with law.

2. The Company may be liquidated prior to the expiry of the operation term or extended for additional term by a decision of the Company Owner or regulations of the law.

Article 6. The legal representativesof the Company

Full name (write in capital letters) : ...  Sex: ...                                                                   

Title: Director

Date of birth: ...   Ethnic group:         Nationality: ...

Passport No: ...

Date of issuance: ..., Place of issuance: ...

Permanent resident address: ...

Current address: ...

Phone: ...              Fax: ...             

Email: ...      Website: ... 

2. Rights and obligations of the company’s legal representatives: 

a) Represent the company to exercise rights and perform obligations arising from company’s transactions, represent the company to act as petitioner, defendant, person with related interests, obligations in arbitration proceedings, courts and to exercise other rights and perform obligations in accordance with law.

b) Must reside in Viet Nam, when the remaining legal representative exits Viet Nam, must authorize in written another person to exercise rights and perform obligations of the legal representative when the former exits Vietnam. In such case, the legal representative shall remain responsible for the performance of the authorized rights and obligations.

c) If upon expiry of the term of authorization stipulated in clause 2 of this Article, the legal representative of the company has not yet come back to Viet Nam and does not provide any other authorization, then the authorized person shall continue to perform rights and obligations of the legal representative of the company within the scope of authorization until the legal representative of the company is back to work at the company or until the company owner decides to appoint another person to act as legal representative of the company.

CHAPTER II

CAPITAL AND COMPANY OWNER

Artilce 7. Charter capital. 

1. All charter capital shall be distributed by the Company Owner.

2. Charter capital of the Company is VND ... (in words: ...), includes:

Time of capital contribution: within 90 days from the date of Business Registration Certificate.

3. If the company owner fails to contribute in full and on time for the charter capital stipulated at Clause 2 of this Article, the company owner must register to adjust charter capital equal to the value of the actuallly contributed captal within 30 days, from the last date on which the charter capital must be fully contributed. In such case, the company owner must be responsible for financial obligations of the company corresponding to the share of charter capital commited, which arose prior to the time the company registers to change its charter capital. 

4. Company Owner is responsible to the extent of all assets owned by the owner for the company’s financial obligations, for any loss or damage resulting from failure to contribute or failure to contribute in full and on time to the charter capital. 

Article 8. Change of charter capital

1. The company shall change its charter capital in the following cases: 

a) Return part of capital contribution in its charter capital if it carries out business activities continuously in more than two years, from the date of business registration and ensures payment of all of its debts and other property obligations after it repays the owner. 

b) Charter capital has not been contributed in full and on time by the company owner in accordance with Article 74 Law on Enterprise.

2. The company increases its charter capital by way of the company owner making additional investment or raising additional capital contributed by other persons. The Company Owner shall decide on the form of increase and the amount of increase of the charter capital. 

3. Where the charter capital is increased by raising additional capital contributed by other persons, the Company must organize management in the form of: a limited liability Company of two or more members and the company must notify any change to its enterprise registration within ten (10) days, from the date of completion of change of the charter capital. 

Article 9.  Rights of Company Owner.

1. To decide on the contents of the Charter of the Company, amendments of and additions to the Charter of the Company.

2. To make decisions on the organizational and management structure of the Company, except where the Company’s charter has other provisions.

3. To make decisions increase in charter capital of the company, on assignment part or all of the charter capital of the company to other organization or individuals.

4. To decide on use of profit after fulfilment of tax obligations and other finanicial obligations of the company.

5. To decide on re-organization, liquidation and petition for bankruptcy of the company.

6. To recover all of the value of the company’s assets after the company completes liquidation or bankruptcy.

7. Other rights in accordance with the Law on Enterprise and the company’s Charter.

Article 10. Obligations of Company Owner 

1. To contribute in full and on time to the charter capital of the company. 

2. To comply with the company’s charter.

3. To identify and separate assets of the Company Owner from assets of the Company. The Company Owner must separate his personal expenditure and expenditure for his/her family from the expenditure for him as the Company Chairman and Director.

4. To comply with the law on contracts and relevant legislation with respect to any purchase, sale, borrowing, lending, lease or rent and  other transactions between the Company and the Company Owner.

5. Company Owner may only withdraw capital by way of assignment of a part or all of the charter capital to other organizations and individuals; in the case of withdrawal of all or part of its contributed capital from the Company in another form, the Company Owner and other related individuals, organizations must be jointly liable for debts and other property obligations of the Company.

6. The Company Owner must not withdraw profits of the Company in cases where the Company has not paid in full all debts and other property obligations which become due.

 7. To perform other obligations in accordance with the Law on Enterprise and the charter of the Company.

Article 11. Exercise rights of Company Owner in some special cases.

1. Where the Company Owner assigns or makes a gift a part of the charter capital to other organization or individual or where the company admits new members, the company must organize its orperation in the form of a limited liability company with two or more members and simultanenously register change to its enterprise registration within 10 days, from the date of completion of the assigment, making the gift or admission of new members.

2. Where the company owner is dissolved or bankrupt, the person(s) receiving assignment of the share of ccapital contribution shall become the owner or member(s) of the company. The company must organize its operation in the corresponding form of enterprise and register to change its enterprise registration within 10 days, from the date of completion of the assignment.

CHAPTER III

ORGANIZATIONAL AND MANAGERIAL STRUCTURE OF THE COMPANY 

Article 12. Organizational and managerial structure

1. Company’s Chairman. 

2. Director.

Article13. Company’s Chairman. 

1. Company’s Chairman is apppointed by the Company Owner. The Chairman of the company shall, in the name of the Company Owner, implement rights and obligations of the company, except for the rights and obligations of the Director; is responsible before law and to the Company Owner for the implementation of delegated rights and obligations in accordance with the Law on Enterprise, (other) relevant laws and the company’s charter.

2. Rights, obligations and working regime of the company’s chairman in respect of the Company Owner shall be conducted in accordance with regulations at the company’s charter, Law on Enterprise and (other) relevant laws.

3. Decision(s) of the company’s chairman on implementation of rights and obligations of the company owner shall take effect from the date of approval by the company owner, unless otherwise stipulated in the company’s charter.

Article 14. Director

1. The Company’s Chairman shall appoint or emply a Director for a term not exceed 05 years to manage the day - to - day business operation of the company. Director is responsible before law and the company’s chairman for the implementation of his/her rights and obligations. The company’s chairman can simultaneously act as Director.

2. Director has the following rights and obligations:

a) To organize the implementation of decision(s) of the company’s chairman;

b) To make decisions on all matters relating to the day - to - day operations of the company;

c) To organize the implementation of business plan, project of the company;

d) To issue rules on internal management of the company;

dd) To appoint, remove or discharge managers in the company, except for entities falling within the authority of the company’s chairman;

e) To sign contract on behalf of the company, except for cases falling within the authority of the company’s chairman;

g) To make recommendations with respect to the organizational structure of the company;

h) To submit the final annual financial statements to the company’s chairman;

i) To recommend the plan for use of profit or dealing with loss in business;

k) To recruit employees;

l) Other rights and obligations mentioned in the Company’s charter, labour contract which the Director enters into with the Company’s Chairman.

3. Director must satisfy the following criteria and conditions:

a) Have full criteria stipulated in the Law on Enterprise;

b) Have full capacity for civil acts and not fall into the category of entities stipulated at Clause 2 Article 18 Law on Enterprise;

c) Have professional qualification and practical expericence in management of the company.

Article15. Obliation of the Company’s Chairman, Director.

1. To comply with law, the company’s charter, decisions of the company owner in the implementation of delegated rights and obligation.

2. To perform delegated rights and obligations honestly, prudently and to their best ability in order to assure the maximum legitimate interests of the company and the company owner. 

3. To be loyal to the interests of the company and the company owner; not to use information,  know-how of the company, or to abuse his/her position and power or to use assets of the company for personal benefit or for the benefits of other organizations, individuals.

4. To notify the company in a timely, complete and accurate manner of any enterprise in which he/she or his/her related person(s) are the owners or hold controlling shares or share of capital contribution. This notice shall be displayed at the head office and branches of the company.

5. Other rights and obligations stipulated in the Law on Enterprise, Company’s charter and (other) relevant laws.

Article16.  Remuneration, salary and other benefits of managers of the company.

1. The company’s managers are entitled to remuneration or salary and other benefits in accordance with business results and efficiency of the company.

2. The company owner shall decide on the rate of remuneration, salary and other benefits of the company’s chairman. Remuneration, salary and other benefits of managers of the company shall be included in the operating expenses in accordance with the law on taxation, (other) relevant laws and shall be recorded as a separate item in the annual financial statements of the company.

CHAPTER IV

THE SEAL OF THE COMPANY

Article 17. About the seal of the company. 

1. About the form of the seal: the seal shall have a circle form, its diameter is about 36 mm, the seal’s face shall be made from rubber, on the face of the seal shall have circles of the same heart, numbers and words shall be floatingly carved.

2. About content of the seal: write the name of the company ( the name stated in the  business registration certificate), write the number of the business registration certificate, write the name of the place where the company’s head office is located and register to operate. 

3. Colour of ink of the seal is: red colour.

4. About the number of seal: the company shall have one (01) circle seal (called the company seal).

Article 18. About the management, use and keeping  of the company seal

1. The management, use and keeping of the company seal is performed in accordance with rules set by the company chairman.

2. The company seal shall be used in cases in accordance with law and regulations or where transaction parties agree about use of seal. 

3. Making seal on all documents, papers, transaction documents and contracts of the company must be agreed by the company chairman or Director.

CHAPTER V

FINANCIAL ACCOUNTING, DISTRIBUTION OF AFTER TAX PROFIT AND DEALING WITH LOSS IN BUSINESS OPERATION

Article19. Fiscal year

1. Fiscal year of the company starts from January 01 western calendar and terminates on December 31 every year. 

2. The first fiscal year of the company shall start from the date of its business registration certificate to December 31 of the same year.

Article 20. Accounting books, financial statements

1. Accounting books of the company shall be properly, fully prepared in accordance with current law and regulations.

2. At the end of each fiscal year, the company shall prepare financial statements to submit to the company owner for consideration. 

3. Within 90 days from the last date of the fiscal year, annual financial statements of the company shall be sent to the tax department, business registration office and competent statistics office. 

Article 21. Distribution of after tax profit

1. The company shall only entitled to distribute profits to its members only if  it makes profits from business after fulfilling tax and other financial obligations in accordance with the provisions of law, and is still capable to pay off all due debts and other property liabilities afterward.

2. Where part of the contributed capital is returned because the charter capital is reduced not in accordance with the Law on Enterprise, or where profits are distributed to members not in accordance with clause 1 of this Article, all members must return to the company the amount of money or other assets they received or must be jointly liable for debts and other property liabilities of the company until all members have fully returned the amount of money, other assets which they received equivalent to the reduced amount of capital or the distributed amount of profits.

3. Profits shall be distributed in the following order:

3. 1. To make up losses in previous years which were not entiled to offset against profits before tax. 

3. 2. To pay penalties for breaching of law. 

3. 3. To deduct actual expenses which have been paid but were not entiled for including in reasonable expenses when determining taxable income.

3. 4. Distribute profits to partners who have contributed capital in accordance with business co-operation contracts (if applicable).

3. 5. The remaining profits shall be distributed as per decision of the company owner.

Artilce 22. Dealing with losses incurred in business operation.

1. Losses incurred in business operation shall be shared to members in proportion to their share of capital. In case the company incurred loss in previous year, then profit for the current year must be prioritized to offset loss incurred in previous year.

2. About accounting affairs:

2. 1. Offset to undistributed profits of previous years (if any).

2. 2. Offset to undistributed profits of the subsequent years (if any).

3. About the taxation affairs: Shall be implemented in accordance with provisions of the Law on corporate income tax and legislative documents providing guidances on current tax regulations.

CHAPTER VI

ESTABLISHMENT, RE-ORGANIZATION, DISSOLUTION AND PROCEDURE FOR ASSETS LIQUIDATION

Article 23. Establishment

1. The company shall be established after the company’s charter is approved by the company owner and is issued business registration certificate by the business registration office. 

2. All expenses relate to the establishment of the company shall be recorded in the company’s expenses and shall be counted reducing expenses of the first fiscal year.

Article 24. Dissolution and liquidation of company’s assets.

 1. The company shall be dissolved in the following cases:

a) The operation duration stated in the company's charter expires without any decision to renew;

b) In accordance with a decision made by the company owner.

c) The business registration certificate is withdrawn.

2. The company shall be entitled to dissolve only after paying off all its debts and other property liabilities and the company is not in the process of dispute at Court or Arbitration. Related managers and the company shall be jointly liable for the company’s debts. 

Article 25. Liquidation of the company’s assets.

1. For assets of the company, when the company does not have demand for use or assign to other individuals, organizations or when the company dissolves, bankrupts, the company must perform procedures to liquidate assets.

2. Director bases on inventory results, tracking process of assets use, requests the division which manages assets to prepare submission to the company owner or company chairman to decide on the liquidation of assets.  

3. Director bases on the decision to liquidate assets of the company owner or company chairman to set up assets liquidation body, to decide the liquidation of assets in the order of procedures and provisions of law. 

4. Director shall organize to implement liquidation of assets and report results of assets liquidation to the company owner or company chairman.

Chapter VII

TERMS OF IMPLEMENTATION

Article 26. Effect of the Charter. 

This Charter takes effect from the date of business registration certificate issued by the business registration office. 

Article 27. Final terms.

1. Affairs relate to operation of the company but do not mentioned in the Charter shall be stipulated by the Law on Enterprise and related legislative documents. 

2. In case this charter contains provisions against the law or causes implementation against the law, then such provisions shall not be implemented and shall be considered to make amendment by the company owner.

3. The company owner shall consider, decide on the amendment, addition to the Charter. 

The Charter have been considered each chapter, each article by the company owner and to be signed, sealed hereafter to verify.

The Charter consists of 7 chapters 27 articles, is prepared into 02 copies with equal validity: 01 copy shall be registered at the business registration office, 01 copy shall be kept at the company’s head office. 

All reproducing, copying must be verified by the company owner./.

COMPANY OWNER 

(Signature, full name and stamp) 

Consulting services:

Phone: 0914 165 703 or email: dmslawfirm@gmail.com

Charter of a single member limited liability company in Vietnam 

Prepared by: Thi-Ha Nguyen, Lawyer’s assistant

DMS Law firm in Vietnam Director (Signed) Lawyer Do Minh Son