The legal representative of the enterprise is an important position in the process of establishing and operating the enterprise. Therefore, businesses and individuals need to understand the rights and obligations of this position. Our article will outline the role of the representative in the business and some issues to keep in mind.
The legal representative of the enterprise (“Legal rep”) is the individual representing the enterprise not only to exercise on its behalf the rights and obligations arising from the transactions of the enterprise, but also as a requester for settlement of civil matters, plaintiff, defendant, the person with related interests and obligations before arbitration, court and other rights and obligations as prescribed by law.
Legal rep has the following responsibilities:
The following individuals may not hold the position of legal rep of an enterprise:
Number: A limited liability company and a joint stock company can have more than one legal rep. In case the company’s charter does not clearly stipulate the division of rights and obligations of each legal representative, each legal rep is an authorized representative of the enterprise before a third party.
Requirement to reside in Vietnam: Must ensure that there is always at least one legal representative residing in Vietnam. In case the only legal rep of the enterprise leaves Vietnam, he/she must authorize in writing another individual residing in Vietnam to perform his/her rights and obligations.
Work permit: Legal rep who is a foreigner needs to apply for a work permit according to regulations and comply with immigration issues when working in Vietnam.
In some cases, the legal representative holds other positions in the enterprise such as: (i) the chairman of the members’ council or the company president in a limited liability company or (ii) the chairman of the board of directors in a joint-stock company or (iii) director, general director, so the legal representative has additional rights and obligations of these titles.
The article is based on applicable law at the time noted as above and may no longer be appropriate at the time the reader approaches this article as the applicable law has changed and the specific case that the reader wishes to apply. Therefore, the article is only for reference.