The director of a valuation enterprise is responsible for managing all activities of the enterprise, and ensuring compliance with the law, professional ethics, and valuation standards. Under the Law on Prices 2023, a person who wishes to be a director in such a sector must be a valuer at least 36 months of professional practice at the same enterprise and must not be subject to any prohibition from practice in order to qualify as a director. The director may not concurrently act as the legal representative of another valuation enterprise and cannot be a public official or civil servant. The appointment shall be made by the owner, the members’ council, or the board of directors, depending on the type of enterprise. The director shall take responsibility if the enterprise violates the law; if they continue to hold office without meeting the required qualifications, they shall be deemed in violation and may be subject to administrative sanctions, removal from office, or suspension of the enterprise’s operations.
I. The role of the director of valuation enterprises
The director of valuation enterprises is responsible for organizing and managing all valuation activities, ensuring that services are provided in compliance with legal provisions, professional standards, and ethical norms.
Specifically, the director shall:
- Manage and supervise the quality of the enterprise’s valuation activities;
- Sign and assume responsibility for valuation reports and certificates;
- Organize and implement internal procedures for inspection, supervision, and compliance;
- Act as the legal representative in civil, economic, and administrative relations related to valuation activities.
II. Legal provisions on the director of valuation enterprises
1. Conditions and criteria for becoming the director of valuation enterprises
According to Clause 1, Article 51 of the Law on Prices 2023, the director of valuation enterprises must satisfy the following conditions:
- Being a valuer currently practicing at the same enterprise;
- Having at least 36 months of professional practice;
- Possessing full civil act capacity and not falling under any legal prohibition from practice (e.g., revocation of the valuer’s card, criminal conviction, etc.).
These requirements ensure that the director not only possesses professional experience but also upholds ethical conduct and meets all legal qualifications.
2. May the director of one valuation enterprise simultaneously serve as the legal representative of another enterprise?
The director of one valuation enterprise may not concurrently serve as the legal representative of another valuation enterprise. Pursuant to the Law on Prices 2023, this restriction aims to prevent:
- Conflicts of interest;
- Collusion or fraudulent cooperation between valuation enterprises;
- Adverse impacts on the quality and transparency of valuation activities.
3. Authority to appoint the director of valuation enterprises
The appointment authority is vested in:
- The owner of the enterprise (for a single-member limited liability company);
- The members’ council (for a multi-member limited liability company);
- The general meeting of shareholders or the board of directors (for a joint-stock company).
The appointee must fully meet the statutory conditions under the Law on Prices, and the appointment must be publicly disclosed in accordance with legal requirements.
III. Clarifications on certain questions regarding the director of valuation enterprises
1. May public officials, civil servants, or public employees serve as directors of valuation enterprises?
Under the Law on Cadres and Civil Servants and the Law on Public Employees:
- Public officials, civil servants, and public employees are prohibited from establishing, contributing capital to, or managing private enterprises, including valuation enterprises.
Accordingly, they are not eligible to serve as directors of valuation enterprises.
2. What is the director’s liability when the enterprise violates valuation regulations?
The director shall be jointly or directly liable for any violation in the following circumstances:
- Directly signing inaccurate valuation certificates;
- Failing to inspect or supervise, resulting in employee misconduct;
- Having negligence in quality control;
- Allowing the use of valuation certificates containing false information.
Possible sanctions include:
- Administrative fines (under Decree No. 109/2013/NĐ-CP);
- Revocation of the valuer’s card;
- Suspension of the enterprise’s operations;
- Criminal prosecution in serious cases (e.g., where substantial damage is caused to the State, individuals, or organizations).
3. Can directors continue to serve if they no longer meet the conditions for valuation practice?
A director who no longer meets the statutory requirements for valuation practice may not continue to hold the position.
If they nevertheless continue to perform managerial duties, such conduct constitutes a violation of the law.
Sanctions may include:
- A fine of not less than 20,000,000 VND;
- Mandatory replacement of the legal representative;
- Suspension of operations or revocation of the enterprise’s certificate of eligibility if the violation is not remedied within the prescribed period.
IV. Legal consultancy services on the director of a valuation enterprise
To ensure compliance and prevent potential legal risks in the director of valuation enterprises, seeking assistance from legal consultancy services is essential. NPLAW provides professional consulting services ranging from contract drafting, clarification of legal provisions, to support throughout procedural implementation. This comprehensive assistance helps clients save time and ensure successful business operations.
