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- 10 / 01 / 2021 -
Remove obstacles for enterprises with multiple legal representative

On June 17, 2020, the Law on Enterprise 2020 was passed by the National Assembly to replace the Law on Enterprise 2014, effective from January 1, 2021.

One of the typical points in the Law on Enterprise 2020 is the regulation on the legal representative. Specifically as follows:

– As prescribed in Clause 2 Article 13 of the Law on Enterprises 2014: “A limited liability company or joint-stock company may have one or multiple legal representatives. The quantity, titles, rights and obligations of legal representative of the enterprise shall be specified in the company’s charter.”

– As regulated in Clause 2 Article 12 of the Law on Enterprises 2020: “A limited liability company and a joint-stock company may have one or more legal representatives. The company’s charter specifies the number, managerial position and rights and obligations of the enterprise’s legal representative. If the company has more than one legal representative, the company’s charter specifies rights and obligations of each legal representative. In case the division of rights and obligations of each legal representative is not clearly specified in the company’s charter, each legal representative of the company will be the authorized representative of the enterprise to the party third; All legal representatives are jointly liable for any damage caused to the enterprise in accordance with the civil law and other relevant laws. ”

Thus, it can be seen that the Law on Enterprise 2020 has more specific provisions in the following points:

+ If the company has more than one legal representative, the company’s charter specifies rights and obligations of each legal representative. 

+ In case the division of rights and obligations of each legal representative is not clearly specified in the company’s charter, each legal representative of the company will be the authorized representative of the enterprise to the party third; 

+ All legal representatives are jointly liable for any damage caused to the enterprise in accordance with the civil law and other relevant laws. 

Hope the above information is helpful to The Esteemed Readers.

Bizlawyer is pleased to accompany with The Esteemed Readers!

 

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