Establishing a 2-Member LLC in Vietnam: A Comprehensive Guide

Starting a Limited Liability Company (LLC) with two or more members is a popular choice for business ventures in Vietnam. This guide from NT International Law Firm provides a comprehensive overview of the latest regulations, document requirements, and procedures for establishing a 2-member LLC in 2023.

Establishing a 2-Member LLC in Vietnam: A Comprehensive Guide

What is a 2-Member LLC?

A 2-member LLC is a legal entity formed by two individuals or organizations contributing capital to a shared enterprise. Each member’s responsibility for debts and obligations is limited to the extent of their capital contribution.

Key Features

Key Features:

• Number of members: Minimum 2, maximum 50 (individuals or organizations).
• Legal status: Separate from members’ assets with independent financial obligations.
• Limited liability: Members’ liability capped at their contributed capital.
• No share issuance: Capital raising limited to bonds and member contributions.
• Transferable capital: Members can transfer part or all of their capital under specific conditions.

Advantages

Advantages:

• Reduced financial risk for members.
• Simplified management due to smaller member base.
• Controlled capital transfer and protection against unwanted investors.

Disadvantages

Disadvantages:

• Limited capital raising potential compared to joint-stock companies.
• Maximum member limit restricts scalability for larger businesses.

Eligibility and Legal Basis

Eligibility and Legal Basis:

• Eligible entities: Organizations with legal status and individuals aged 18+ with full civil capacity.
• Ineligibility: Individuals banned from establishing companies under Article 17 of the Enterprise Law 2020.

Name Requirements

Name Requirements:

• Language: Vietnamese.
• Components: Type of business (LLC) and company’s proper name.
• Display: Headquarters, branches, offices, and business documents.
• Prohibitions: Names violating Article 38 of the Enterprise Law 2020.

Business Scope:

• Free to operate in legal industries unless prohibited by law.
• Must comply with conditions for conditional business sectors and foreign investor access.
• Choose a Level 4 economic sector from the Vietnam Economic Sector System.

Headquarter Requirements:

• Located within Vietnam with a valid contact address and phone/fax/email details.
• Cannot be used in apartments or group houses.
• Must comply with security, safety, environmental, and local regulations.

Charter Capital

Charter Capital:

• Total value of member contributions recorded in the company charter.
• No minimum required for certain industries.
• Must be fully contributed within 90 days of business registration.
• Partial contribution or non-contribution requires charter capital and member ratio adjustments.
• Limited withdrawal options except in specific cases.

Legal Representative:

• Represents the company in legal matters and business transactions.
• Can have 1 or more individuals, at least one residing in Vietnam.
• Automatic replacement by remaining member if the individual representative becomes ineligible.

Required Documents

Required Documents:

• Application for business registration.
• Company charter.
• List of members and founding shareholders (if applicable).
• Legal documents for members (individuals and representatives).
• Investment registration certificate for foreign investors (if applicable).

Establishment Procedures:

1. Draft documents: Seek legal counsel for assistance.
2. Submit application and pay fees: Register online or at the provincial business registration office.
3. Announce business registration: Publish information on the National Business Registration Portal.
4. Obtain legal seal: Engrave the company’s official seal.
5. Post-establishment procedures: Place signs, open bank accounts, register for e-signature, pay taxes, print invoices, contribute capital fully.

Fees and Charges

Fees and Charges:

• Business registration fee: 50,000 VND (one-time).
• Business registration content publication fee: 100,000 VND (one-time).
• Fee exemptions for electronic registration and conversions from household businesses.

Conclusion:

Establishing a 2-member LLC in Vietnam offers several advantages for small businesses. By understanding the legal framework, document requirements, and procedures outlined in this guide, you can navigate the process smoothly and establish a successful venture. Remember, seeking legal counsel for personalized guidance is crucial to ensure compliance and mitigate potential risks.

NT International Law Firm is Here to Help

NT International Law Firm is Here to Help

NT International Law Firm has addressed the question of how you can open your own 2 or more members LLC. If you have any further questions or concerns regarding corporate law, please contact our law firm immediately for expert legal advice.

If you require any legal assistance, please feel free to reach out to us via phone at 090 252 4567 or through email: info@ntpartnerlawfirm.com. At NT INTERNATIONAL LAW FIRM, our team is committed to offering you prompt and personalized advice.

You also might be interested in:

• The 2015 Civil Code in English
• The 2020 Law On Enterprises in English