VIETNAMESE BUSINESS LAW
Compare and contrast the internal governance structure of a two or more member limited liability company and that of a joint stock company. The following figures are the Management Structure of a two or more member limited liability company (LLC) and joint stock company (JSC):
Source: PhD Bui Xuan Hai (2008), Internal Governance Structure in Vietnam, Ho Chi Minh University of Law, Vietnam.
To have better understanding about internal governance structure of LLC and JSC, we compare characteristics of both companies based on the following criteria (Articles mentioned in the following table are according to Law on Enterprise of Vietnam, 2005):
Table 1.1: Compare and contrast the internal governance structure of LLC and JSC. In conclusion, the Enterprise Law 2005 provides different fixed internal governance structures for 2 company types: LLC and JSC as well as other enterprises. An internal governance structure often consists of four constituents: The general meeting, a BOM, CEO and Controlling Board with statutory powers and functions of each constituent. Furthermore, powers and duties of each corporate governance body of an internal governance structure are mandatory under the Law on Enterprise 2005 and can be expanded but not decreased by the company’s constitution. Question 2:
2.1. Discuss circumstances in which the party which breaches a commercial contract can be exempted from liability. Provide an example for each case. The party which breaches a commercial contract can be exempted from liability in cases: a. Upon occurrence of any event which the parties have agreed will give rise to immunity from liability; b. Upon occurrence of any event of force majeure;
c. Upon a breach by one party which was totally due to the fault of the other party; d. Upon a breach by one party which was due to implantation of a decision of a competent Sate administrative body of which the parties could not have known at the time of entering into the contract. (Art. 294.1 of the Commercial Law of Vietnam, 2005).
a. Upon occurrence of any event which the parties have agreed will give rise to immunity from liability: Commercial Law upholds the freedom of contract. Therefore, the parties have the rights to agree on the case when disclaimer commercial contract. Agreement between the parties about the case to exclude liability in respect before the violation occurred and is valid until the time the aggrieved party to apply sanctions. When contracts are concluded in writing, shall be exempt from liability agreement recorded in the contracts or in the content of addendums. Even when the parties signed the agreement still can verbally or specific acts or amendment or supplement to the east of cases disclaimer. For example: In the sale agreement was signed between the seller A and the buyer B, the 2 parties agreed on the time of delivery was 01/10/2012. Also in the contract, the 2 parties agreed to a provision that allow the seller A will not be responsible to the buyer B if the time for delay of delivery was not exceeded 15 days (means should be before 16/10/2012). On 30/09/2012, Seller A prepared products for delivery to the buyer B as agreed upon by contract. At the same time on 30/09/2012, another buyer C - a direct competitor of the buyer B, has proposal sellers A to buy their goods at prices which was higher than 20% of the contract between A and B. Seller A took their advantage on agreement with buyers B and agreed to sell to the buyer C of goods that should be delivered to the buyer B, because they think that within 15 days, they have capacity to prepare products for delivery to the buyer B. On 15/10/2012, buyer B received goods purchased under the contract with seller A. But this time, Buyer B is forced to sell goods because the market was no longer in demand. Thus, Buyers B suffered some significant damage to this action due to lower prices....
References: 1. Bui Xuan Hai and Chihiro Nunoi (2008). Corporate Governance in Vietnam: A system in Transition. Hitotsubashi Journal of Commerce and Management 42 (2008), pp. 45 – 46, Hitotsubashi University.
2. Commercial Law of Vietnam, 2005.
3. Enterprise Law of Vietnam, 2005.
4. Le Minh, Toan and Walker, Gordon (2008). Corporate Governance of Listed Companies in Vietnam, Bond Law Review: Vol. 20: Iss. 2, Article 6. Retrieved from: http://epublications.bond.edu.au/blr/vol20/iss2/6.
5. Luanvan.net.vn (2013). Thoa thuan han che hay mien tru trach nhiem do vi pham hop dong. Retrieved from http://luanvan.net.vn/luan-van/de-tai-thoa-thuan-han-che-hay-mien-tru-trach-nhiem-do-vi-pham-hop-dong-29365/.
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