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PwC Vietnam Legal NewsBrief Changes to the
23 July 2020
Law on Enterprises
At a glance...
On 17 June, the National Assembly passed the amended Law on Enterprises
(new LOE) which will be effective from 1 January 2021 and replace the
existing 2014 LOE.
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In detail…
The new LOE does not make fundamental changes, but rather deals mostly with registrations, operations,
restructurings and liquidations of enterprises. Some notable points include:
• The requirement for registering seal specimens has been abolished. The new LOE also recognises electronic
seals registered in line with the law.
• The new LOE confirms that online (via the National Business Registration Portal) and offline registrations have
the same legal validity. Currently, after an online submission, companies must also submit hard copy application
documents. The new LOE, however, does not require such paperwork.
• While the new LOE maintains the time limit for injecting charter capital within 90 days from the date of the
issuance of enterprise registration certificates, it allows certain exceptions in case of in-kind contributions where
the time required for transportation/importation of assets or completion of changes of ownership are not counted
as part of the 90-day time limit.
• The new LOE stipulates conditions and procedures for private placements of bonds by both non-public joint stock
companies (JSC) and limited liability companies.
• The new LOE for the first time introduces the concept of “Non-voting Depository Receipt” (NVDR) (in
Vietnamese: “Chứng chỉ lưu ký không có quyền biểu quyết”), which allows the owners of NVDR in a JSC to have
full economic benefits corresponding to the shares deposited, but not including voting rights. The government will
provide further guiding regulations on NVDR.
• Minority shareholders in JSCs will now have better protection. For example, shareholder(s) or a group of
shareholders holding 5% or more (instead of 10% under the current LOE) of a company will have the right, inter
alia, to request the convening of a General Meeting of Shareholders in certain cases or to request the Board of
Inspection to investigate certain matters relating to the operation of the company. Shareholder(s) or a group of
shareholders holding 10% of voting rights or more can nominate candidates for the Board of Management or the
Board of Inspection as currently. However, the new LOE removes the requirement that a shareholder must hold
the shares for at least six consecutive months in order to exercise such rights.
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Contact us
This publication has been prepared for general guidance on matters of interest only, and does not constitute
professional advice. For further information, please reach out to us.
Richard Irwin
Partner - Tax & Legal services
+84 (28) 3824 0117
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Phan Thi Thuy Duong
Partner – Legal services
+84 (28) 3823 0796, ext. 1508
[email protected] Le Anh Tuan
Director – Legal services
+84 (24) 3946 2246, ext. 1504
[email protected]
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