Tue, Nov 08, 2022, 09:10:00
The Ministry of Planning and Investment responded to this issue as follows:
Regarding the identification of the legal representative of a one-member limited liability company as an individual, the Enterprise Law No. 59/2020/QH14 does not specify the title of the legal representative; does not stipulate that the owner is automatically the legal representative.
The company owner has the right and responsibility to decide on the title of the company's legal representative and write it down in the company's charter on the basis of the following provisions:
Clauses 1 and 2, Article 12 of the Law on Enterprises No. 59/2020/QH14 stipulates:
Mr. Truong Dinh Van (Dak Lak) asked, if the one member limited liability company is an individual, please change the legal representative (donate 100% of the contributed capital, change the owner) if the name of the company is not changed, then it is legal. How is the construction contract being handled? Can unfinished business be inherited?
According to the provisions at Point g, Clause 2, Article 24 of the Law on Enterprises No. 59/2020/QH14, the company's charter provides for "the number, management titles and rights and obligations of the legal representative of the company" enterprise; division of rights and obligations of the legal representative in case the company has more than one legal representative.
According to the provisions of Clause 2, Article 76 of the Law on Enterprises No. 59/2020/QH14, the owner of a one-member limited liability company is an individual "to decide on the content of the company's charter, to amend and supplement the company's charter".
Regarding the change of the owner of a one-member limited liability company being an individual, Clause 5, Article 77 of the Law on Enterprises No. 59/2020/QH14 stipulates:
"5. The company owner is only entitled to withdraw capital by transferring part or all of the charter capital to another organization or individual; in case of withdrawing part or all of the contributed charter capital from the company. In other forms, the company owner and related individuals and organizations must be jointly liable for the company's debts and other property obligations.
According to the provisions of Article 53 of the Government's Decree No. 01/2021/ND-CP dated January 4, 2021 on business registration, in case the owner of a one-member limited liability company is changed due to donation of the entire contributed capital, the donor shall submit an application for registration of change of company owner, which includes a contract for donation of contributed capital.
Pursuant to the above provisions on individual one-member limited liability companies, the donation of the entire contributed capital by the owner will lead to a change in the company's owner and a change of the legal representative (in the case of in line with the charter, the individual owner is the company's president and also the legal representative).
However, the change of owner and legal representative does not change the rights and obligations of the company's legal entity, including rights and obligations for construction contracts without the company's legal entity signed with its partners and customers before changing the owner. For details on this content, please consult with competent state management agencies in the field of civil law and economic contracts.
