The appointment of a legal representative is a critical decision that directly affects corporate governance and the legal validity of an enterprise. Failure to comply with regulations on authority, documents and procedures, or scope of representation may result in contracts being declared invalid, administrative sanctions, or disputes. The following article provides a comprehensive overview of the legal nature, procedures and main considerations when appointing a legal representative in accordance with current regulations.

I. Introduction to issues relating to the appointment of legal representatives

The appointment of a legal representative is a fundamental legal procedure determining an individual who, in the name of the enterprise, establishes and performs transactions and takes legal responsibility before the law.

In practice, many enterprises encounter difficulties regarding appointment authority, notification deadlines, scope of representation and the legal consequences arising from non-compliance. A proper understanding of these issues helps enterprises mitigate risks and ensure stable, lawful operations.

II. Overview of the appointment of legal representatives

A correct understanding of the concept, timing and objectives of appointment enables enterprises to structure their management effectively, while ensuring that the company’s rights and obligations are exercised consistently and in compliance with law.

1. When is a company required to appoint a legal representative?

A company is required to appoint a legal representative in the following circumstances: Upon establishment of the enterprise; upon change of the existing legal representative due to dismissal, resignation, death, loss of civil act capacity or failure to satisfy statutory conditions; and upon corporate reorganization, changes in management model, or amendments to the charter providing for the supplement or replacement of legal representatives.

Timely appointment ensures that the company’s operations are not disrupted and that transactions have a duly authorized representative.

2. What are the primary objectives of appointing a legal representative?

The primary objectives of appointing a legal representative are to ensure that the company has a lawful individual acting on its behalf to establish and perform rights and obligations arising in business operations; to maintain stability and continuity in management, administration and dealings with partners and state authorities; and to clearly allocate legal responsibility to the representative, thereby reducing legal risks and disputes for the enterprise.

3. Who has the authority to decide on the appointment of a legal representative within a company?

Under the Law on Enterprise 2020 (as amended in 2025), the authority to appoint or remove a legal representative depends on the type of enterprise and the provisions of the company charter.

  • For joint stock companies: Under Article 153 of the Law on Enterprise 2020 (as amended in 2025), the Board of Directors has the authority to elect, remove and dismiss the Chairperson of the Board of Directors; to appoint, remove, conclude or terminate contracts with the Director or General Director and other main managers in accordance with the charter. Where the legal representative concurrently holds such positions, the Board of Directors has authority to decide on the appointment or replacement of the legal representative.
  • For multi-member limited liability companies: Under Articles 12 and 54 of the Law on Enterprise 2020 (as amended in 2025), the company must have at least one legal representative; the charter specifies the number, titles, and rights and obligations of legal representatives. Accordingly, the Members’ Council has the authority to decide on the appointment and removal of the legal representative (typically the Chairperson of the Members’ Council or the Director/General Director), unless otherwise provided in the charter.
  • For single-member limited liability companies: Under Article 12 of the Law on Enterprise 2020 (as amended in 2025), the company owner has authority to decide on the appointment and removal of the legal representative. The legal representative may be the Chairperson of the company or the Director/General Director, depending on the organizational model and the charter.

In summary, the authority to appoint a legal representative is entitled to the highest management body of the enterprise corresponding to each corporate form, and must be determined based on both the Law on Enterprise 2020 (as amended in 2025) and the company charter.

4. Following appointment, what are the basic rights and responsibilities of the legal representative?

Upon appointment, the legal representative acts in the name of the enterprise to execute rights and obligations arising from business activities and takes direct legal responsibility for the execution of such rights and obligations.

Pursuant to Article 13 of the Law on Enterprise 2020 (as amended by Clause 4, Article 1 of the amended Law 2025), the legal representative has the following basic duties:

  • To exercise rights and obligations honestly, prudently and in the best lawful interests of the enterprise, and not to act arbitrarily or beyond delegated authority.
  • To remain loyal to the interests of the enterprise and not abuse position or powers for personal gain; not to use information, business secrets, investment opportunities or assets of the enterprise for personal interests or the interests of other organizations or individuals.
  • To comply with disclosure obligations by promptly, fully and accurately notifying the enterprise of any capital contributions, shares or ownership interests held by themselves or related persons in other enterprises as required by law.

In case of breach of the above duties, the legal representative takes personal liability for damage caused to the enterprise in accordance with law.

III. Relevant legal provisions governing the appointment of legal representatives

The appointment of a legal representative is not merely an internal corporate decision but must strictly comply with the Law on Enterprise and relevant legal instruments to ensure legality in corporate governance, management and dealings with third parties.

1. Within what duration must the appointment of a legal representative be notified to the business registration authority?

Under Article 28 of the Law on Enterprise 2020 (as amended in 2025), information on the legal representative constitutes mandatory contents recorded on the Enterprise Registration Certificate. Accordingly, any appointment, replacement or change of information relating to the legal representative constitutes a change in enterprise registration contents.

Pursuant to Clause 2, Article 30 of the Law on Enterprise 2020 (as amended in 2025), the enterprise must register changes to enterprise registration contents within 10 days from the date of change. Notification must be made to the business registration authority for updating legal representative information in accordance with law.

2. What dossiers and legal procedures are required for the appointment of a legal representative?

Pursuant to Article 43 of Decree No. 168/2025/ND-CP, upon appointment or replacement of a legal representative, limited liability companies and joint stock companies must submit dossiers for registration of changes in enterprise registration contents to the provincial-level business registration authority where the headquarter is located. The basic dossier includes:

  • A written proposal for registering change of legal representative;
  • A copy or original of the resolution/decision on the change of legal representative issued by the company owner (for single-member limited liability companies), the Members’ Council (for multi-member limited liability companies), or the General Meeting of Shareholders or the Board of Directors (for joint stock companies), depending on whether the charter is amended.

The signatory of the proposal must be the Chairperson of the Members’ Council, the Chairperson of the company, the Chairperson of the Board of Directors or a duly authorized person in accordance with Clause 2, Article 43 of Decree No. 168/2025/ND-CP. In special cases where the legal representative dies, goes missing, has restricted civil act capacity or is otherwise unable to continue holding office, the dossier may be substituted with relevant documents evidencing such legal status as prescribed.

Upon receipt of a valid dossier, the provincial-level business registration authority shall issue a new Enterprise Registration Certificate within three working days; if the dossier is invalid, the enterprise will be requested to amend or supplement the dossier in accordance with law.

3. What common errors lead to rejection of registration dossiers when appointing a legal representative?

Registration dossiers are commonly rejected if enterprises make appointment decisions beyond their authorities, if resolutions/decisions are missing or improperly formatted, or if information on the legal representative is inconsistent between the dossier and the company charter.

Other frequent errors include late submission beyond the statutory 10-day deadline, dossiers signed by unauthorized persons, missing mandatory documents under Article 43 of Decree No. 168/2025/ND-CP, or appointment of individuals who do not satisfy statutory conditions for legal representatives.

IV. Questions regarding the appointment of legal representatives

1. May a foreigner be appointed as a legal representative and what should be noted?

Current Vietnamese law does not prohibit foreigners from holding the position of legal representative of enterprises in Vietnam. However, such appointment must fully comply with Article 12 of the Law on Enterprise 2020 (as amended in 2025), with particular attention to the requirement that the enterprise must always have at least one legal representative residing in Vietnam. 

Where the legal representative is a foreigner and is absent from Vietnam for more than 30 days, written authorization must be granted to another individual residing in Vietnam to execute rights and obligations. Failure to comply may expose the enterprise to legal risks in operations and transactions.

2. When appointing a legal representative, how should the company stipulate limits of authority in compliance with the Law on Enterprise?

When appointing a legal representative, the company should clearly stipulate the scope and limits of authority in the charter, appointment decision or management contract to ensure compliance with the Law on Enterprise 2020 (as amended in 2025) and to mitigate legal risks. In particular, transactions and decisions requiring approval of the Members’ Council/Board of Directors or the company owner should be specified (e.g., execution of high-value contracts, borrowing, guarantees, or disposition of material assets).

At the same time, delegation of authority must be aligned with the duties of the legal representative under Article 13 of the Law on Enterprise 2020 (as amended in 2025), including duties of honesty, prudence, loyalty to the enterprise’s interests and prohibition against abuse of office for personal gain. Clear limits of authority do not lose the effectiveness of representation for bona fide third parties, but serve as an important basis for determining personal liability and handling internal violations where the legal representative exceeds delegated authority.

3. Where and how are procedures for amending enterprise records upon appointment of a legal representative carried out?

Procedures for amending enterprise records upon appointment of a legal representative are implemented at the provincial-level business registration authority (Business Registration Office) where the enterprise’s headquarter is located, pursuant to Article 43 of Decree No. 168/2025/ND-CP. The basic steps are as follows:

- Step 1: Preparation of dossier

The enterprise prepares a dossier for registration of change of legal representative, including:

  • A written proposal for registration of change of legal representative;
  • Resolution or decision on the change of legal representative issued by the competent authority:
  • Company owner (for single-member limited liability companies);
  • Members’ Council (for multi-member limited liability companies);
  • Board of Directors or General Meeting of Shareholders (for joint stock companies, depending on whether the charter is amended);
  • Other documents required for special cases (authorization, documents evidencing the legal status of the former legal representative, if any).

-Step 2: Submission of dossier

The dossier may be submitted in person, by post, or online via the National Business Registration Portal to the provincial-level Business Registration Office.

- Step 3: Processing of dossier by the business registration authority

Within three working days from receipt of the dossier:

  • If valid: Issuance of a new Enterprise Registration Certificate;
  • If invalid: Written notification of required amendments or supplements.

- Step 4: Receipt of results and update of relevant information

Upon issuance of the new Enterprise Registration Certificate, the enterprise updates internal records, seals, digital signatures, bank information, partners, etc. (where relevant).

Note: dossiers must be submitted by duly authorized signatories, with complete documents and within statutory time limits to avoid rejection or requests for amendment.

4. How should conflicts between the company charter and appointment decisions be handled?

Where an appointment decision conflicts with the company charter, such appointment is not recognized internally. As a matter of principle, appointments must comply with both the Law on Enterprise 2020 and the company charter.

Accordingly, the enterprise must amend and supplement the charter to align with the appointment decision, then re-issue a valid appointment decision and proceed with registration of changes with the business registration authority. Failure to rectify such inconsistency in a timely manner may expose transactions entered into by improperly appointed representatives to legal risks and disputes.

5. What are the legal consequences where a legal representative executes contracts beyond delegated authority?

Where a legal representative executes contracts beyond the scope of delegated authority, legal consequences are assessed based on the relationship between the enterprise, third parties and the representative. As a general principle, where third parties act in good faith and do not know and are not required to know of the excess of authority, the contract may remain binding on the enterprise. Conversely, where third parties know or should have known that the representative acted ultra vires, the enterprise may refuse performance, unless the contract is subsequently ratified.

Internally, a legal representative who executes contracts beyond delegated authority takes personal liability, including liability to compensate the enterprise for damages and other liabilities pursuant to Article 13 of the Law on Enterprise 2020 (as amended by Clause 4, Article 1 of the 2025 Amending Law), where such acts cause damage.

V. Are you seeking a reputable legal expert to assist with matters relating to the appointment of legal representatives?

Where enterprises encounter difficulties in appointing, replacing or determining the authority of legal representatives, engagement of experienced legal counsel helps mitigate legal risks and ensure compliance. NPLaw provides in-depth advisory services, supports review of charters, internal authority structures, preparation of dossiers and liaison with business registration authorities, enabling enterprises to complete procedures promptly, lawfully and with legal certainty.

The above information is for reference purposes only. For detailed advice on specific cases, please contact NPLaw for immediate consultation.