Payment of shares registered for subscription upon enterprise registration in Vietnam

Hi DMS Lawyer in Vietnam! Can you advise me about the time limit for payment of shares subscribed for upon establishment of a shareholding company in Vietnam ? What if the subscribers did not make any payment of the shares subscribed to the company ?

Hi!

Payment of shares registered for subscription upon enterprise registration:

Shareholders must pay in full for the number of shares which have been registered for subscription within 90 days from the date of issuance of the enterprise registration certificate, except where the company’s Charter or share subscription agreement stipulates a shorter time limit. The Board of Directors is responsible to supervise and monitor to ensure that shares which have been registered for subscription by the shareholders shall be paid in full and on time.

Within the period from the date of issuance of an enterprise registration certificate to the last day on which the shares which have been registered for subscription must be paid in full in accordance with Clause 1 of this Article, the number of votes of the shareholders shall be calculated on the basis of the number of ordinary shares which have been registered for subscription, unless otherwise stipulated in the company’s Charter.

If upon expiry of the period stipulated in Clause 1 of this Article, any shareholder has not paid or has only paid for part of the number of shares registered for subscription, the following provisions shall apply:

The shareholder who has not paid for the number of shares registered for subscription shall automatically no longer be a shareholder of the company and must not assign the right to purchase such shares to another person;

The shareholder who has only paid for part of the number of shares registered for subscription shall have the right to vote and receive dividends and other rights in proportion to the number of shares paid; and must not assign the right to purchase the number of shares unpaid to another person;

Shares which have not been paid for shall be deemed unsold shares and the Board of Directors has the right to sell such shares;

The company must register adjustment of the charter capital on the basis of the par value of shares which have been paid for in full and any change to founding shareholders within 30 days from the date of expiry of the period in which the shares registered for subscription must be paid for in full as stipulated in Clause 1 of this Article.

Any shareholder who has not paid or has not paid in full for the number of shares registered for subscription must be responsible for the financial obligations of the company in proportion to the total aggregate par value of shares registered for subscription, which arise within the period stipulated in Clause 1 of this Article. Members of the Board of Directors and the legal representative must be jointly responsible for any loss arising from failure to implement or failure to implement correctly the provisions of Clauses 1 and Point d Clause 3 of this Article (Article 112, Law on Enterprises No.68/2014/QH13 dated 11/26/2014).

Related topics:

Conversion of shareholding companies into limited liability companies

Conversion of limited liability companies into shareholding companies

Capital of shareholding companies in Vietnam

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Time limit for payment of shares subscribed upon company establishment in Vietnam