Establishing a branch is a significant step in expanding a business’s reach and operations. However, this process often involves navigating a complex web of legal and regulatory requirements. Many businesses have questions and concerns regarding the various aspects of establishing a branch, from compliance with local laws to operational considerations. In this discussion, we will address these questions and provide insights into the key factors that businesses should consider when embarking on the journey of establishing a branch.
Question:
If there are 2 out of 8 members absent from a Board of Directors meeting and the remaining 6 members present agree, is the meeting valid? Should the head of the company or the head of the branch sign the notice to establish a company branch? Can the head of the branch consist of 2 people, including a director and a deputy director? Is it necessary to submit the company’s charter when registering a branch?
Answer:
1/ According to Article 157, Clause 8 of Law on Enterprises 2020, a meeting of the Board of Directors is valid when attended by at least three-quarters of the total members. If a meeting is convened according to this provision and the required number of members is not present, it can be reconvened within 7 days from the planned date of the first meeting, unless the company’s charter stipulates a shorter timeframe. In this case, the meeting can proceed if more than half of the members of the Board of Directors are present. It is recommended that the company review and follow the regulations accordingly.
2/ According to the registration form for establishing a branch Appendix II-11 of Decree 122/2020/ND-CP, the authorized signatory for the notice is the Legal Representative of the company.
3/ Businesses should carry out the documentation, procedures, and process for registering a branch’s activities in accordance with the regulations specified in Article 31 of Decree 01/2021/ND-CP regarding business registration.
4/ According to the registration form for establishing a branch Appendix II-11 of Decree 122/2020/ND-CP, a company should only register one person as the head of the branch.
Conclusion
In conclusion, the process of establishing a branch can be both exciting and challenging for businesses. It requires a thorough understanding of legal and operational aspects, as well as careful planning and compliance with local regulations. Having questions about this process is entirely normal, and seeking answers and guidance is a proactive step towards success. By addressing these concerns and seeking expert advice when needed, businesses can navigate the complexities of establishing a branch with confidence, positioning themselves for growth and expansion in new markets.
HMLF is always available to offer assistance in understanding the procedures with authorities.
Harley Miller Law Firm “HMLF”
Head office: 14th floor, HM Town building, 412 Nguyen Thi Minh Khai, Ward 05, District 3, Ho Chi Minh City.
Phone number: +84 937215585
Website: hmlf.vn Email: miller@hmlf.vn
