Authorized representatives of businesses are a fairly common and familiar term in business operations. Therefore, understanding the legal regulations regarding the rights, obligations, and responsibilities of the parties is extremely necessary. In the article below, An Tam Law Firm will help you understand this issue better. Please refer to the following information.
1. What is an authorized representative of a business?
An authorized representative of the owner, member, or shareholder of a company that is an organization must be an individual authorized in writing to act on behalf of that owner, member, or shareholder to exercise rights and obligations as prescribed by law.
2. Cases of authorized representation in businesses
The cases of authorized representation are as follows:
In a limited liability company with two or more members, where one member is an organization and holds 35% or more of the charter capital, there are three authorized representatives;
In a joint-stock company where the shareholder is an organization with charter capital of 10% or more of the total number of common shares, there can be a maximum of 3 authorized representatives;
The legal representative is absent from Vietnam.
3. Rights and Responsibilities of Authorized Representatives of Enterprises
The authorized representative has the following rights and responsibilities:
To act on behalf of the represented party to exercise their rights and obligations;
To exercise rights and obligations within the scope of the authorization recorded in the authorization document;
To attend meetings, make decisions, etc.;
To adhere to the principles of honesty and respect the interests of the authorizing party;
To be responsible for their own violations.
4. What is the duration of authorized representation in an enterprise?
The duration of representation is determined by the authorization document;
If the authorization document does not specify:
From the beginning of the civil transaction to the termination of the civil transaction;
Unless otherwise specified in a civil transaction, the term is one year from the date of representation.
5. Termination of Authorized Representation
Authorized representation terminates when:
By agreement;
The term of authorization expires;
The authorized representation work has been completed;
One party unilaterally terminates the authorization;
The represented person ceases to exist;
The authorized representative is no longer alive;
The authorized representative lacks:
Civil legal capacity;
Civil capacity to act.
Factors arising that cause the authorization to be interrupted: epidemics, natural disasters, and other cases as prescribed by law.
6. Some Notes for Authorized Representatives
For organizations that are owners, members, or shareholders of a company, the authorized representative must be an individual.
The work and scope of authorization must be clearly defined in the authorization document;
Authorized representation is established in writing and complies with legal regulations regarding validity conditions.
7. Frequently Asked Questions
How is the scope of authorized representation established?
The scope of authorized representation is determined based on the agreement between the represented person and the authorized representative.
Is the business liable if the authorized representative exceeds the scope of representation?
The business is only liable for the authorized representative exceeding the scope of representation when the authorization document specifically stipulates this.
Can the authorized representative be changed during the period of authorized representation?
Yes. If, during the period of authorized representation, the authorized representative no longer meets the requirements or exceeds the scope of authorization, the business can change the authorized representative.
8. An Tam Law Firm provides business law consulting services.
Understanding the regulations regarding the rights and obligations of authorized representatives is essential. When businesses understand the law, they can operate with peace of mind, protect their interests, and avoid unnecessary risks. Furthermore, the authorized representative also needs to understand their own rights and obligations to protect their own interests and minimize legal risks.
An Tam Law Firm specializes in business law consulting – Online consultation – Absolute confidentiality – Consulting fees starting from only 350K!
See more of our services at:
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In businesses, authorized representation is very common, but not all parties fully understand their rights and obligations in both authorizing and receiving authorization. Therefore, proactively learn and understand the legal regulations as soon as possible. If you still have difficulties, please contact An Tam Law Firm immediately for prompt advice.
– Diem Phuc (Consulted by Lawyer Diep Quoc Hoang) –