Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.Pháp luật Việt Nam về quản trị công ty trách nhiệm hữu hạn hiện nay.VIETNAM ACADEMY OF SOCIAL SCIENCES ACADEMY OF SOCIAL SCIENCES TONG HOANG HA CURRENT VIETNAMESE LEGAL REGULATIONS ON MANAGEMENT OF LIMITED LIABILITY COMPANIES Major Economic Law Code 9 38 01 07 DOCTORA.
VIETNAM ACADEMY OF SOCIAL SCIENCES ACADEMY OF SOCIAL SCIENCES TONG HOANG HA CURRENT VIETNAMESE LEGAL REGULATIONS ON MANAGEMENT OF LIMITED LIABILITY COMPANIES Major: Economic Law Code: 38 01 07 DOCTORAL DISSERTATION OF ECONOMIC LAW HANOI - 2023 Work was completed at: GRADUATE ACADEMY OF SOCIAL SCIENCES, VIETNAM ACADEMY SOCIAL SCIENCE Supervisor: Assoc Prof., Dr Nguyen Nhu Phat Examiner 1: Assoc Prof., Dr Duong Dang Hue Examiner 2: Assoc Prof., Dr Nguyen Huu Chi Examiner 3: Assoc Prof., Dr Le Thi Thu Thuy The dissertation will be defended before the Academy level doctoral dissertation grading committee at Graduate Academy of Social Sciences - Vietnam Academy of Social Sciences At: Time date month 2021 This doctoral dissertation can be found at: - National Library - The Library of the Academy of Social Sciences INTRODUCTION 1 Rationale for the study The limited liability company is a capital-based company, with limited liability regime and a limited number of members, suitable for small and medium-sized enterprises The principle of separating the company's assets from personal assets allows investors who are members of the limited liability company to have the opportunity to invest in high-risk business areas to generate greater profits However, the investor's benefit carries a potential risk to the debtor as they cannot collect debts from the investor's personal assets When liquidating, the company only pays its debts with company assets and therefore creditors are at risk of not being able to collect all of their debts In business, debt management and risk management are crucial problems that can determine an investor's success or failure, and thus there are many ways for investors to apply, including management strategies Regarding principle, management comes under the freedom of business and investment decision-making rights of the investor For a limited liability company, although the limited liability regime and the right to associate have advantages, they also bring risks to investors and customers, as well as creditors of the company Therefore, the law needs to intervene to protect the rights and interests of all parties, including intervening in the management activities Vietnamese law has participated in the "common playground" of international law, but is still "weak and inadequate” The Company Law, which was introduced in 1990, mentions several models of companies The laws on corporate governance are still in their infancy and have not been clearly regulated in the 2005 Enterprise Law The 2014 Enterprise Law and the new 2020 Enterprise Law have some provisions related to the governance of different types of companies, but it cannot be said that they show a close attention or in-depth discussion on this issue Meanwhile, countries with developed legal systems such as the United States, Germany have established separate laws for each type of company as soon as they are recognized, and they still have value today The reality is that the regulations on corporate governance in Vietnam as mentioned above are limited, not comprehensive, or in other words, still weak in all types of enterprises The understanding of corporate governance is still limited, and the guidelines and laws on corporate governance, including the governance of limited liability companies, are even scarcer Not to mention the gray areas and the effectiveness of the existing corporate governance laws are still limited In that context, studies on corporate governance law for limited liability companies have not been given the deserved attention, and independent and in-depth studies are even less common (most studies on corporate governance law currently focus on state-owned companies, joint stock companies evaluated according to the OECD Corporate Governance Principles) This is in contrast to the fact that the limited liability company is the most commonly established and popular type of company in Vietnam today The situation above highlights the urgent need for a separate study on the topic of “Current Vietnamese legal regulations on management of limited liability companies” to ensure its necessity Purposes and tasks of the dissertation: - Research purposes The purpose of the dissertation is to conduct research on the topic “Current Vietnamese legal regulations on management of limited liability companies” in order to summarize the following content: (1) The system and in-depth theoretical issues of limited liability company governance have been mentioned in previous studies but are still scattered in individual studies, parts of research on other types of companies, and have not been addressed as an independent research work for limited liability companies in Vietnam; (2) Clarify the legal theoretical issues and legal issues related to the management of a limited liability company; (3) Based on the research on the theoretical model, evaluate the advantages of Vietnamese legislation related to the management of limited liability companies Identify limitations, shortcomings, and propose recommendations and solutions to improve and enhance the effectiveness of the implementation of Vietnamese legal provisions on this issue - Research purposes: Based on the research purpose stated above, the dissertation on “Current Vietnamese legal regulations on management of limited liability companies” sets out specific tasks to be addressed, including: + System, research and evaluate relevant domestic and foreign researches, directly or indirectly addressing the issue of limited liability company governance and the law on limited liability company governance, evaluate the advantages-disadvantages, shortcomings that need to be supplemented + The research will gather legal theoretical contents regarding the management of limited liability companies and issues that affect and influence the scope of the study from information systems that collect data from both domestic and foreign sources + On the basis of theory combined with practical legal life to evaluate the current legal situation and apply the law on management of limited liability companies in Vietnam today + On the basis of research results to propose contents and solutions to complete and improve the efficiency of law enforcement on limited liability company governance in Vietnam Objective and scope of the dissertation study - Objective of the study: + Theoretical contents on management of limited liability companies and laws on management of limited liability companies worldwide and in Vietnam, indicating which theoretical schools have dominated the legal thinking of Vietnamese lawmakers + The specific regulations of Vietnamese law on the management of limited liability companies, compared to other countries in the world (such as the United States, Germany, China, etc.) +The practice of implementing the law on management of limited liability companies in Vietnam, comparing the stages related to the amendment of the Law - Scope of the study: + Regarding content: The Enterprise Law is the fundamental law, while other related laws such as the Investment Law, Civil Law serve as supplements, providing more clarification on regulations related to limited liability company management The Enterprise Law clearly stipulates two types of limited liability companies, which are one-member limited liability company and limited liability company with two or more members However, the dissertation will focus on narrow aspects of the law on management of limited liability companies with two or more members, where a one-member limited liability company has a specific external relationship as the representative of state capital This is a separate issue that can be studied in another independent dissertation due to the scale and complexity of this type of enterprise + Regarding space: Research on the historical process of governance and impact on the promulgation of laws in Vietnam, specifically the Company Law 1990, Enterprise Law 2005, 2014, 2020 compared with the regulations of countries such as the United States, Germany, China and the system of principles of the OECD Moreover, the scope of the dissertation will focus on the enforcement of the law on the management of limited liability companies in the life of businesses with a large scale, stable and long-term development history, closely associated with the different development periods of the country to clarify the changes of the enterprise and the Enterprise Law that adapts to the changes of the country through each period, without territorial limitations + Regarding time: At the time of this dissertation research and completion, the Enterprise Law 2020 has just been enacted and come into effect Therefore, to ensure a smooth research process, in addition to analyzing and evaluating the amendments of the new Law compared to the 2014 Enterprise Law, the dissertation will also use data from the 2014-2020 period to demonstrate the implementation of the laws that have been maintained in the legal practice of the Enterprise Law, which are still valid, still a trend, and a necessary objective law of legal life Methodology and research methods of the dissertation The problem of the dissertation is to study the operation of society and related legal regulations The research is mainly theoretical in nature On the basis of the dialectical materialism and historical materialism methodology of Marxism-Leninism, methods such as abstraction, analysis, syndissertation, modeling, etc will be used in most chapters and sections For each purpose and task pursued in each chapter, the emphasis will be on using specific methods according to each purpose New scientific contributions of the dissertation The research results of the dissertation have made new contributions to the legal science in the following aspects: - Firstly, this is the first doctoral dissertation that synthesizes and independently researches scientific works at home and abroad related to the management of limited liability companies and the law on the management of limited liability companies in Vietnam - Secondly, the dissertation systematizes and contributes to clarifying theoretical issues about limited liability companies, limited company governance and the law on limited company governance - Thirdly, on the basis of studying theoretical models to assess the current state of law and practice of law enforcement on the management of limited companies in Vietnam; pointed out that maintaining a common Enterprise Law for all types of companies and not fully applying the "principle of separation" has effectively reduced the legal provisions on corporate governance of limited companies From there, it leads to requirements and solutions to improve the effectiveness of enforcing the law on the management of limited liability companies in Vietnam Theoretical and practical significance of the dissertation - Theoretical significance: The research results of the dissertation have reference value for studying, constructing internal management mechanisms of limited liability companies, and improving the legal framework for this activity in Vietnam in the future - Practical significance: serves as a reference document for the operation and application of management laws for limited liability companies for legal practitioners and businesses, as well as for research purposes in teaching law related to limited liability companies in Vietnam Structure of the dissertation Besides the introduction, conclusion, commitment, illustration box, list of references, abbreviations and appendices, the dissertation consists of main chapters: Chapter 1: Overview of the research situation and issues that need to be researched on the dissertation topic Chapter 2: Theoretical issues in managing a limited company and laws related to managing a limited liability company Chapter 3: Situation of Vietnam Law on Limited Liability Company Governance and Legal Implementation of law on Limited Liability Company Governance in Vietnam Chapter 4: Direction and solutions to complete, improve the efficiency of Law Enforcement on Limited Liability Company Governance Chapter OVERVIEW OF THE RESEARCH SITUATION AND ISSUES THAT NEED TO BE RESEARCHED ON THE DISSERTATION TOPIC 1.1 Overview of the research situation 1.1.1 Research situation in foreign countries + Studies related to the legal nature of limited liability companies: In the world, countries with developed economies and laws, the basis for dividing types of businesses is not the same Basically, the types of companies are unified into two types according to their legal nature: counterparty companies and partnership companies According to Prof Dr Friedrich Kuebler and Prof Dr Juergen Simon (1992) in the work "Some issues of economic law of the Federal Republic of Germany" [84]: In order to suit the category of “medium and small sized enterprises”, the limited company and the first limited company law was born in Germany in 1892, following the Law on Joint Stock Company in 1870 For the limited liability company, the members of the company are based on acquaintance with each other and only want to be responsible for the contributed capital, so the number of members is usually limited In other words, Limited company is defined according to the most common practice, is a type of company for capital, is a legal entity; has independent assets and is only liable for the debts of the company by its capital contribution; can sue and be sued [26, p1] In Germany's limited company law, the separation principle exists That means the limited company has an independent legal status, separate from the members [84] However, despite following this model of Germany, the level of application of this principle is different in different countries According to the assessment of the author Meister/Heidenhain/Rosengarten, The German limited Liability Company, Fritz Knapp Verlag GmbH, Frakfurt am Mains, 2005 [114]: German company law states that a limited company is a combination of the unlimited liability of a partnership and the complexities of a joint stock company This combination is aimed at and ensures flexibility for investors, especially small and medium investors + Schools and theories, applications on corporate governance: "Scientific Management" by Frederich Winslow Taylor (18561915) and associates (USA) [99]; Henri Fayol (1922): "Industrial and General Administration" [100]; The "Z" theory and Japanese management techniques by Willian Gouchi [102] and the Kaizen theory of Massakiimai [103] Laptev V.V (1975), Economic Law, Scientific Publisher, Moscow [104] Maurice Cozian & Alian Vieandier (1989), Corporate organization, Ministry of Justice translated document [105] In addition, in many countries, private schools have been established to teach and train business managers from the lowest level to the highest level of the enterprise There are schools in the US: MBA (Master of Business Administration), Harvard Business School; in Japan: Director Training School at the foot of Mount Phighi, etc Research results suggest that corporate governance is the internal measures for operating and controlling the company; Corporate governance is concerned with the relationships between the Board of Directors, Board of Directors and shareholders of a company and related parties + Research on corporate governance principles: The book “OECD Principles of Corporate Governance” published in 1999, Organization for Economic Co-operation and Development (OECD) [37]; Fayol, H (1917) General and Industrial Management [101] Dunod et E Pinat, Laura Empson (2007), Managing the Modern Law Firm: New Challenges, New Perspectives, Oxford university press [111] The research results of the works mainly provide the basic principles of corporate governance, especially the management of joint stock companies or state-owned enterprises These research results provide some perspectives in determining the principles towards an effective corporate governance model In terms of jurisprudence, the principles of corporate governance should be considered from the perspective of the main impact of the law on enterprises, which is "recognizing the right to establish, organize and manage enterprises and ensure the security of enterprises." complete legality in capital investment for entities involved in enterprises” [76.p.28] Specifically, the principles of corporate governance from the perspective of jurisprudence are reflected in the following aspects: (i) ensuring the right to freedom of business; (ii) controlling risks and (iii) protecting the rights of creditors 2.1.2 Theoretical issues about limited liability companies Limited liability company is generally understood as: a type of partnership company, is a legal person, has independent assets and is only responsible for the company's debts with the company's assets, can sue and get sued That means the limited liability company has an independent legal status, it is separate from the members [26, p.1] Since the limited company model is the product of legislative activities of the Law on Limited Liability Company in Germany since 1892, countries have received and applied to have many different limited company models, not uniformly applied 2.1.3 Theoretical issues of limited liability company governance Limited liability company governance is a system of regulations defining the rights and responsibilities as well as a mechanism to ensure implementation for members and related persons for the type of limited liability company Researching and determining the legal nature of limited liability company governance will help legislators orient the protection of the rights and interests of related parties Specifically, the legal nature of limited liability company governance is reflected in the following main aspects: First, the division of power (centralization or decentralization) in corporate governance The level of power in limited liability management is probably mainly built on the basis of investment in the company This can also be explained that: Limited liability company is a type of company with capital counterpart, the power of company members is attached to the ratio of assets invested in the company Second, limited liability corporate governance in the study of legal nature is concerned with protecting the interests of investors and creditors In addition, both creditors and investors 16 may also bear the same risk due to self-interested acts of managers and executives; human risks (death, disappearance of capital contributors, etc ).Therefore, it is necessary to take measures to manage and be governed by the law on governance Participants will be protected by law through regulations on the rights and obligations of each party Good corporate governance is a prerequisite for an effective operating control system Factors affecting the corporate governance of limited liability not only /and include: - First, the company's charter The charter is considered as the "Constitution" of the company All companies must have a Charter, which is a must-have document when registering a company This is considered as a contract between the company and its shareholders and between the shareholders, a commitment of all members from the time of establishment, operation to dissolution of the company which regulates the rights, duties, responsibilities of shareholders, members of the board of directors and the relationship between the parties - Second, the power division mechanism in a limited liability company This division of power mainly depends on the proportion of the capital ratio of the members in the company This is a difference from the division of power in other companies - Third, the company's member structure Members are the owners or co-owners of the company, which can be organizations or individuals Member structure of limited liability companies associated with the type of limited liability company or more or one member limited liability company - Fourth, qualifications, leadership capacity, business ethics and responsibilities of company managers - Fifth, information transparency in corporate governance Some risks in limited liability company governance - Firstly, the mechanism of the legal representative of the company Studying regulations on representatives in companies in general and limited companies in particular can lead to risks in corporate governance In a limited liability company of two or more members, the Members' Council elects one member to act as the Chairman The Chairman of the Members' Council may concurrently be the Director or General Director of the company The Chairman of the Members' Council and the Director (General Director) are entitled to exercise different rights 17 and obligations related to the effective operation of the company The actions of these managers will greatly affect the interests of the company as well as all other members in the company - Second, the risk of information transparency in corporate governance Members and employees of the company can take advantage to conduct information trading (insider trading) resulting in the company being harmed or possibly acquired by such acts - Third, on the issue of inheritance in the company One of the goals of inheritance is that the recipient can become a company member This issue has been recognized in the Civil Law of Vietnam as well as some countries in the world However, does that contradict the principle of establishing an enterprise (limited company) based on the close relationship between (former) members? How does it affect the interests of the remaining members? Especially in regard to the company's trade secrets? 2.2 Legal issues of limited liability company governance The legal framework of governance of a limited company includes: - Law on organizational structure of the management, administration and supervision of the operation of the limited company; - Laws on rights and obligations of company members, rights, interests and responsibilities of representatives, managers and supervisors of the enterprise - Laws on company decision-making processes and procedures; mechanism to monitor the behavior of managers to limit the abuse of power over company resources for self-interest 18