TYPES OF COMPANY IN VIETNAM? WHICH ONES WE SHOULD CHOOSE?
Because Vietnam is currently integrating with the global economy, actors must embrace opportunities and build successful production and economic activities. The considerable increase in the number of businesses registering new and re-opening operations demonstrates this. To prevent potential dangers, firms must choose the correct type of business registration based on their goals and capabilities.
- Law on Investment 2020.
1. Limited Liability Company (LLC)
- LLC is a legally recognized entity. As a result, the firm has its own assets, a seal, and a head office, and it can engage in legal transactions on its own behalf without relying on the status of the owner.
- Capital contributors are only responsible for the enterprise's debts and other property obligations up to the amount of capital they supplied. This, like a joint stock corporation, is a significant benefit of LLC. Segregation of personal assets gives a certain level of safety for business participants because members contributing capital to the company are only responsible to the extent of the contributed capital.
- LLC has the ability to raise funds by borrowing money and credit from individuals and businesses. LLC has the ability to issue bonds as well. Shares cannot be issued by a single member limited liability company or two or more member limited liability companies. Like a joint stock company, LLC is not permitted to issue various types of securities in the form of certificates, journal entries, or electronic data.
2. Joint Stock Corporation (JSC)
- A company whose charter capital is divided into equal portions, known as shares.
- The firm must have at least three shareholders, with no upper limit. Shareholders are solely liable for the company's debts and other property responsibilities to the extent that they provided money to the company.
- Joint stock firms have the ability to raise money by issuing a variety of securities.
3. Representative Office (RO)
RO for foreign traders are permitted to be established in Vietnam to carry out the following activities:
- Act as a liaison office and conduct market research.
- Promote and market the traders they represent's business investment prospects.
- Other activities that are legal in Vietnam.
It is important to note that a RO in Vietnam is not permitted to conduct services for profit on behalf of the RO.
- A branch is a subordinate entity of a company that is responsible for carrying out all or part of the company's functions, including that of an authorized representative.
- Branch legal status: A branch, like a representative office, is a dependent entity of the firm with no legal standing.
- Businesses have the ability to open branches both in the country and outside. According to administrative limits, a company can open one or more branches in a given area.
5. Comparison of business entity options for foreign investors
|No capital requirements
No capital requirements
No capital requirements
The above information is about the ‘Type of company in Vietnam? Which ones we should choose?'. For more information and advice on this issue, please contact Doanh Tri Law Firm directly via:
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Bài viết ngày được thực hiện bởi: nguyenthithuytrang
Chức vụ: Giám đốc công ty
Lĩnh vực tư vấn: Dân sự, Hình sự, Doanh nghiệp
Trình độ đào tạo: Thạc sỹ Luật, MBA
Số năm kinh nghiệm thực tế: 10 năm
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