Thứ Hai, 24 tháng 7, 2017

Seven Ways To Keep You From The Wolves

BY Juna Mèo IN , , , , No comments

You have an invention or an idea for an invention. The first people you may hear about - or even may contact you - are from an invention development company. They advertise on radio and TV, and in magazines that cater to the inventive mind - and even some newspapers.

Invention development companies are private and public research companies that purport to help inventors develop, patent, and promote their ideas so they can be commercially licensed or sold. While many of these organizations are legitimate, some are not.

I state my stand on the use of such companies on my website - www.gadgets-gizmos-inventions,com. But, you may want to go that way anyway to develop your patent or invention. If that’s the case, here are seven helpful tips for you to make smart patent and invention development decisions:

?1. Learn About the PatentProcess.
?When you understand the basics of how to get a patent, you will know when invention marketers are making promises they, or the patent system, can't deliver. Knowing the steps to do a patent search, and what is required, as well as knowing what happens in the patenting process can only help you in making the right decision. You will have a better idea about whether the company you are talking to knows what they are doing for you - and not just their pocketbook.??2. Do Your Homework.

?Check the organization's references, ask for credentials, and then check them. Ask them for statistics on how many successes they have had compared to how many total clients. They are required by law to offer you this type of information. In fact, the American Inventors Protection Act of 1999 gives you the following rights when dealing with invention promoters.

Before an invention promoter can enter into a contract with you, it must disclose the following information about its business practices during the past five years:
•             how many inventions it has evaluated,
•             how many of those inventions got positive or negative evaluations,
•             its total number of customers,
•             how many of those customers received a net profit from the promoter's services, and
•             how many of those customers have licensed their inventions due to the promoter's services.

This information can help you determine whether the promoter has been selective in deciding which inventions it promotes, and how successful the promoter has been. Ask for names of “successful” clients, and talk to them.

Invention promoters also must give you the names and addresses of all invention promotion companies they have been affiliated with over the past 10 years.

This information can help to determine whether the company you're considering doing business with has been subject to complaints or legal action.

You can call the U.S. Patent and Trademark Office (USPTO) at 1-866-767-3848, and the Better Business Bureau, the consumer protection agency, and the Attorney General in your state or city, and in the state or city where the company is headquartered to check them out.??3. Be Realistic.

?Not every invention is patentable. Know that very few ideas - even the good ones - become commercially successful. Be wary of any developer willing to promote virtually any invention. If you are presented with the phrase - "We think your idea has great market potential" - beware, and take it for what it is - in a lot of cases, just a sales pitch. ??4. Know Where Your Money Is Going.

?Ask the organization how your money will be spent. Be on guard against large up-front fees and find out exactly how the money is spent. If the company gives you something like - "Our company has evaluated your idea, and now wants to prepare a more in-depth research report. It'll be several hundred dollars" - ask them if the idea is good enough for more research why don’t they foot the bill. ??5. Protect Your Rights.

DO NOT disclose your invention to a developer over the phone (or at any time) before first having them sign a confidentiality agreement. You could forfeit valuable patent rights. A sample confidentiality agreement is available on my website. ??6. Track Your Invention's Progress.
?If you decide to use an invention development organization, deal directly with the agent or patent attorney who will be handling your patent application. A lot of these type of firms outsource the work which is not good for you.

Many invention promotion firms also may claim to perform patent searches on your idea. Fraudulent invention promotion firms usually do patent searches that are are incomplete, conducted in the wrong category, or unaccompanied by a legal opinion on the results of the search from a registered patent attorney.

Because unscrupulous firms promote virtually any idea or invention without regard to its patentability - they may go ahead and market an idea for which someone already has a valid, unexpired patent. In that case, you may be the one subjected to a patent infringement lawsuit - even if the promotional efforts on your invention are successful. Most probably, the way the infringement suit is attracted is through a successful product.??7. Don't Get Discouraged! ??The patent process can be very complicated, so you will probably need professional help. There are many good patent agents and attorneys that can help you. The U.S. Patent and Trademark Office maintains a nationwide register of attorneys and agents who meet the legal, scientific and technical requirements of the office.
The first step should be a patent search done by a reputable searcher. Your patent attorney can help with this, and should review the search for a package price, depending on the complexity of the invention.

Hang in there. It is a long and complicated process. But if your idea passes the initial search test and evaluation, there is a good chance you can receive a patent - in two or so years.


 Source: Articlecity.com

Thứ Năm, 20 tháng 7, 2017

Copyright and related Right

BY Juna Mèo IN , , , , No comments

Copyright/ related Rights Registration
Copyright is stipulated in particularly in Civil CodeLaw on Intellectual Property 2005, amended and supplemented in 2009 and  Decree No. 100/2006/ND-CP: Detailing And Guiding The Implementation Of A Number Of Articles Of The Civil Code And The Intellectual Property Law Regarding The Copyright And Related Rights

Copyright means rights of an organization or individual to works which such organization or individual created or owns. Copyright shall arise automatically at the moment a work is created and fixed in a certain material form; irrespective of its content, quality, form, mode and language and irrespective of whether or not such work has been published or registered
As stipulations of Law on Intellectual Property in 2005, amended and supplemented in 2009, Copyright in works shall comprise moral rights and economic rights. Moral rights (except publication rights) shall be protected all whole life of authors and from 50 to 75 years since the author or the final co-author dies.
Copyright-related rightsor related rights means rights of organizations and individuals to performances, phonograms, video recordings, broadcasts and encrypted program-carrying satellite signals. The rights of performers shall be protected for fifty (50) years, which starts from the year following the year in which the performance is turn into a fixed form. The rights of producers of audio and video recordings shall be protected for fifty (50) years which starts from the year following the year of publication, or fifty (50) years which starts from the year following the year in which any unpublished audio and video recording is turned into a fixed form. The rights of broadcasting organizations shall be protected for fifty (50) years which starts from the year following the year in which a broadcast is made.
Like the Trademark registration, Copyright registration shall be the important legal bases to resist actions of appropriating copyright, impersonating authors, counterfeiting, infringing on copyright which lead to damage on reputation of authors.
ANT Lawyers supplies service on copyright/ related right consultant as follows:
·         Advise in grounds for the generation and establishment of Copyrights; basic limitation of Copyrights/ related rights;
·         Consult and implement procedures relating to copyright/ related rights registration;
·         Consult, represent Clients negotiating  and drafting using agreement, assignment agreement and other contracts relating to  copyright/ related rights registration;
·         Complaint decision relating to issuing copyright/ related rights certificate;
·         Consult, collaborate with competent authorities in solving copyright/ related rights infringement.



Thứ Ba, 18 tháng 7, 2017

Why Client Should Retain Real Estate Lawyers in Vietnam?

BY Juna Mèo No comments

Benefits of retaining a Real Estate Lawyer in Vietnam
Due to changes in law attracting foreigners to come to live, and invest in Vietnam, foreigners have growing interest in investment and acquiring real estate.  However, as real estate is valuable assets, the law on real estate ownership and real estate transactions are complicated, especially for foreigners.

Under the land ownership regime in Vietnam, land belongs to the entire people with the State acting as the owner’s representative and uniformly managing land.  Hence, in Vietnam, the land users will have the land use right without the private ownership of the land.  Land law 2013 does not allow foreigner to have land use rights in Vietnam. It only allows foreign invested enterprises to be permitted to use land through the form of land allocation or lease.

Although foreigner do not have land use rights in Vietnam, they are allowed to own houses in Vietnam under the Law on Housing. In addition, the Law on Real Estate Business has certain limitations for foreign investors to conduct real estate business in Vietnam and must meet the legal requirements.
Foreign investors investing in Vietnam wish to use the land to conduct business activities, or intend to conduct real estate business in Vietnam, or simply a foreigner wishing to purchase and own real estate in Vietnam should be aware of the legal provisions on conditions of implementation, orders and procedures to of the transactions to minimize risks.  The assistance of the lawyers on real estate in Vietnam shall be worthwhile.

Real estate lawyers in Vietnam would have in-depth knowledge of the Land Law, Law on Housing, Law on Real Estate Business and related regulations. In addition, they would have practical experience in implementing legal procedures, handling disputes, and supporting real estate transactions in Vietnam. The real estate lawyers could explain the restrictions on land use rights of foreign organizations and individuals in Vietnam and the conditions for conducting business in real estate in Vietnam.  The lawyers at request could assist the foreigners with the process and procedures to work with state agencies to obtain land use rights for enterprise and home ownership rights for individual more effectively.

When conducting transactions related to real estate such as buying, selling, transferring, renting, leasing, real estate lawyers could also provide assistance in in legal due diligence of the real estate to minimize legal risk to clients. It is important to evaluate the legal status of the property, the owner of property, whether property is in dispute, or subject to additional requirements of government before being sold by the developer and the people eligible for entering into the transaction. In addition, the lawyers in Vietnam can advise clients to draft or review the agreements, sales contract as well as the process to legalize the process to comply with the law in Vietnam.


Chủ Nhật, 16 tháng 7, 2017

Industrial Design Registration in Vietnam

BY Juna Mèo IN , , , No comments

How to Register Industrial Design in Vietnam?
Industrial design is the appearance of the product which is expressed through shapes, lines, colors or combinations of these factors.
A product as being commercially marketed will have a certain style with a combination of certain shapes, lines, colors, etc which is the design of the product. When a new design to be launched, if it attracts customers, there is a big chance there will be fake or imitated products. Therefore, before a new design is launched, business owners need to conduct registration procedures for protection of industrial designs. That is the action for the protection of its product design and the prestige of the enterprise in the market.  This protection will prevent the infringement of the design, therefore the registration of industrial design protection is essential.
ANT Lawyers IP services in the field of industrial design registration advice covers:
• Look-up, assess and consult possibilities to register industrial design in Vietnam and abroad;
• Represent clients in applying for certificates of industrial design, record modification, extend degree of industrial protection in Vietnam and abroad;
• Evaluate the effectiveness of the certificate of industrial design registration and the possibility of industrial design rights violation;
• Implement of the protected industrial design rights: investigate, monitor, negotiate, seek arbitration or initiate a lawsuit or request other competent agencies for handling of infringement in Vietnam and abroad;
• Negotiate, draft, evaluate and register the of changing industrial design ownership in Vietnam and abroad;
• Advise on building strategies, brand development; For advice and specific details in each case, please contact us directly for advice.
How ANT Lawyers Could Help Your Business?
Please click here to learn more about ANT Lawyers IP Practice or contact our IP lawyers in Vietnam for advice via email ant@antlawyers.vn or call our office at (+84) 24 32 23 27 71


Thứ Năm, 13 tháng 7, 2017

International Trademark Registration Under Madrid Protocol/ Agreement

BY Juna Mèo IN , , , , No comments

Trademark is the asset of individuals, and organizations which is protected independently in each nation therefore a trademark being registered in a country would still be a subject of violation in another country because it is not yet registered.
Currently based on a trademark patent or a national trademark application, by filing an international application, the trademark owner shall acquire the right of trademark registration in some or all members of the Madrid system.
With highly professional staff and great experience in intellectual property practice in Vietnam, ANT Lawyers would support the in registering your trademark under Madrid Protocol/ Agreement (Madrid System)
Conditions of international registration under Madrid System
People who have been granted the Certificate of Trademark Registration in Vietnam have the right to register their respective international trademarks under the Madrid Agreement;
People who have already filed an application for registration of a trademark in Vietnam and who have been granted a certificate of registration of a trademark in Vietnam shall have the right to make an international registration of the mark corresponding to the Madrid Protocol.
International registration application originating from Vietnam
An application for international registration of a mark designating a contracting party to the Madrid Agreement as a country to be registered and not designating any country member of the Madrid Protocol must be made in French.
An application for international registration of marks designating at least one member country of the Madrid Protocol, including the designation of a country party to the Madrid Agreement, must be made in English or French.
The declaration shall be as form provided by Vietnamese competent Authorities. The declaration shall designate the countries being parties of the Madrid Agreement (may simultaneously be a Member of the Madrid Protocol) and the country member of the Madrid Protocol to which the applicant wishes to apply for trademark protection.
The applicant shall ensure all information is accurate and in accordance with information in attached document.
International registration office for application from Vietnam
International application shall be filled at International Bureau through National Office of Intellectual Property of Vietnam
The date the National Office of Intellectual Property receives the application for international trademark registration shall be the date of the filing if the International Bureau receives the application within two months from the date of receipt. If the application is not completed for submission to the International Bureau within the above time limit, the date of receipt shall be the date of filing the application to the International Bureau.


Thứ Hai, 10 tháng 7, 2017

What a Law Firm Could Assist in an M&A Deal?

BY Juna Mèo No comments

What could be assisted in an M&A Deal by a law firm?
M&A, abbreviated by Mergers and Acquisitions is expanding in both quantity and volume in Vietnam in many sectors. Successful M&A deals depend on various factors and legal due diligence, and drafting agreements are important processes in Vietnam.

For investors whom are interested in M&A deal in Vietnam as buyer or seller,it is important to hire a law firm that will assist in the process. The law firm in Vietnam could provide assessment of the target company through a legal due diligence, a legal background directly related to M&A deal, all of which are necessary to the completion of a successful deal. The attorney could then draft the letter of intent, and legal contracts, including the final purchase agreement, which will include a lot of stipulations that will need to be done correctly in order for the business transaction to be beneficial to both parties and in compliance with Vietnam regulations.

A law firm with expertise of Vietnam regulations, with the lawyers having experience and legal knowledge will be able to provide the clients with the right check-list of the documents to review.  In addition, the presence of lawyers contributes to strengthening the trust of the parties. In recent years, foreign businesses have often made acquisitions of all or part of a Vietnamese enterprise, and they often require the seller to engage law firms specializing in M&A. And now, not only the foreign businesses but also the Vietnamese parties are in need of conducting M&A deals with the participation of lawyers to ensure the success.
Lawyers shall conduct legal due diligence of enterprises, check reports and explanations with prudence, honesty and efficiency. They help the buyer and/or seller to understand their legal status, legal rights and obligations, legal regulations for assets, labor contracts, land records, construction and investment registration, certificates, and licenses and other matters. This is the basis for determining the status of enterprise and possible legal risks may cause. Lawyers will conduct and produce the most comprehensive, accurate, legal and objective information and legal documents by their professional, knowledgeable and ethical.

Lawyers shall advise the structure of an M&A to ensure the commercial intent that the parties are aiming and shorten the execution time and costs. In addition, it ensures the legality of procedures, safety and minimizes the legal and financial risks for the parties.
There is no common contract template for all M&A deals. Lawyers shall actualize the trade agreements, the will of the parties to the legally binding terms of the contract as well as clearly defines the rights and obligations of the parties to ensure the enforceability, minimize unlawful agreements or unclear terms that may cause the subsequent disputes.




Thứ Năm, 6 tháng 7, 2017

Patent Registration under PCT Procedure

BY Juna Mèo IN , , , , No comments

Vietnam joined in Patent Cooperation Treaty (PCT) on March 10th 1993 and originations, individuals can register international patent as provided in PCT by filling registration application at National Office of Intellectual Property of Vietnam (NOIP). NOIP has responsibility to examine and handle the application as provided in PCT.

With highly professional staff and great experience in IP aspect in Vietnam, ANT Lawyers would like to support you in filling international patent under PCT procedure:
Required Document
03 English written declaration for registration PCT application originating in Vietnam;
02 Written descriptions including images or drawings (if any) ;
02 written request of invention protection;
01 Original Power of Attorney;
Other related document (if only).
International Patent registration originating in Vietnam under PCT
Receipt of applications:A registration application of an invention shall be filed in Vietnam, including protection claims in any of the Member Countries of the PCT Treaty (hereinafter referred to as the PCT application originating from Vietnam). The application shall be submitted directly or by mail to the NOIP or the International Bureau of the World Intellectual Property Organization (hereinafter referred to as the International Bureau)
The international search process:This process shall be conducted at competent authorities (National or regional patent office that meets the requirements set by PCT and be designated by PCT General Assembly). National patent office with PCT application originating in Vietnam is: Intellectual Property office of Australia, Austria, the Russian Federation, Sweden, Korea and the European Patent Office.
Publication of the international application: PCT application originating in Vietnam shall be posted at PCT Gazette.
The international preliminary examination: Conducted by the international preliminary examining authority as provided in PCT. The purpose of examination is to give a preliminary and non – binding opinion whether the invention in the application meets the requirement protection or not. Examining authority shall make a preliminary examining report and send to International Bureau.
National or regional phaseinternational application shall be examined form and content as regulation of normal patent registration in each nation.
Note:
Applicants must specify which countries they want the international application to take effect.
Each international application is subject to international search to find out the relevant technical status known to provide preliminary and non-compulsory claims on inventions that require novelty, creativity and usefulness. Therefore, the Contracting Party designated for patent protection is entitled to apply the standards of an invention under its domestic law in relation to the known state of the art and other conditions of competence. Patent shall be decided whether to be accepted for the protection based on the application.


Thứ Tư, 5 tháng 7, 2017

Benefits of Investors to Set-up Business in Ho Chi Minh City

BY Juna Mèo No comments

Why Ho Chi Minh City is a Favourite Destination for Setting up Business?
Ho Chi Minh City offers many benefits for foreign companies to do business and invest.
The population of Ho Chi Minh City is of more than 10 mil, earning a higher average income than other part of the country.  Consumer retail has found Ho Chi Minh City as an attractive market for investment in retail shops, malls, introducing quality consumer goods to the local.
Ho Chi Minh City offers adequate infrastructure such as the Sai Gon port systems, deep seaport access from Vung Tau port systems, Tan Son Nhat international airport, and possible Long Thanh international airport project, Saigon railway station, the expressways, etc, connecting the city to neighbouring countries in the region and other part of the world.  Through setting up factories in industrial zones, processing zones, local and international manufacturing companies could take advantage of high quality labor resources at reasonable cost and move the finished goods to final destinations in US, EU with reasonable lead-time and expenses.  Consequently, the city has become leading industrial city of Vietnam, contributing more than 30% industrial production, 30% GPD and 30% national income to the country’s total.
Ho Chi Minh City is also a financial center, which the biggest stock exchange is located.  Many corporations, and investment companies has chosen Ho Chi Minh City to set-up management and investment offices to search for opportunities,  conduct Merger and Acquisitions and other business transactions, to leverage the annual growth of the country at more than 6%.
At the same time, the city government has been improving policies to support the removal of difficulties for foreign-invested enterprises investing in Vietnam  through fixing administrative procedures to shorten the administrative process, saving time for investors, offering “one-stop” mechanism at the main state agencies.
Our professional consultants and lawyers have assisted a number of foreign companies and individuals to conduct transactions, set-up companies, make investment through M&A, and actively involve in the development of Ho Chi Minh City in particular and the whole country.




Thứ Ba, 4 tháng 7, 2017

Attention in Drafting Registration Application for Invention

BY Juna Mèo IN , , , , , , , No comments

How to Protect Invention Patent in Vietnam?
Inventions are created with purpose to people’s life convenience and consequently bring economic benefits to the inventor. As a result, protecting the intellectual property of inventions through patent registration in Vietnam is essential.

However, applicant of invention may find it difficult in declaring some of the information i.e. name of invention, field of use, technical status of field of use, technical nature and brief description while drafting an invention description that meets legal regulations in Vietnam.
To overcome this difficulty, applicant should take note the followings:
Name of the invention: name of inventions and name of inventor should be brief without promotion.
Filed of use: the invention registration application shall demonstrate the filed in which the invention is applied or related.
Technical status of field of use: the technical shall include information of prior known technical solutions until the priority date of the same application.
Technical nature of invention: the technical nature of the invention is the purpose that the invention need to get or technical problem that the invention shall solve to overcome disadvantage or shortage of the same technical solutions declared in “Technical status of field of use” part.
The description of constitutive signs of invention: The description shall declare new signs of the invention.
Brief description with enclosed images (if any): Applicant shall declare and submit clearly the scope of protection invention request in the description. The scope shall be presented briefly, clearly and fix with the description and images as stipulation of law on intellectual property.
With professional staff and vast experience in Intellectual Property aspect in Vietnam, ANT Lawyers could support inventor in advising and drafting dossier to request patent protection in Vietnam.


Thứ Tư, 28 tháng 6, 2017

Signals of Copyright Infringement

BY Juna Mèo No comments

Authors might find their copyright are infringed in Vietnam and would need legal services from a local legal and intellectual property firm to advise.
A literary, artistic or scientific work is an achievement from hard intellectual labor of the author. However, after publishing works, many authors find others use, print or trade their works without their prior written permission. The copyright infringement action can cause many material damages for authors when their intellectual labor achievements are used by others without prior asking and annual royalties. To ensure the rights of authors, the law strictly forbids from infringing and stipulates particularly as follows:
Appropriating copyright in a literary, artistic or scientific work.
Impersonating an author.
Publishing or distributing a work without permission from the author.
Publishing or distributing a work of joint authors without permission from the co-authors.
Modifying, editing or distorting a work in any way which prejudices the honour and reputation of the author.
Copying a work without permission from the author or copyright holder, except in the cases allowed by the Law
Making a derivative work without permission from the author or copyright holder of the work used for making such derivative work, except in the case allowed by the Law.
Using a work without permission from the copyright holder and without paying royalties, remuneration or other material benefits in accordance with law, except in the cases allowed by the Law.
Leasing out a work without paying royalties, remuneration or other material benefits to the author or copyright holder.
Duplicating, producing copies of, distributing, displaying or communicating a work to the public via a communications network or digital means without permission from the copyright holder.
Publishing a work without permission from the copyright holder.
Deliberately destroying or de-activating the technical solutions applied by the copyright holder to protect copyright in his or her work.
Deliberately deleting or modifying electronic information in a work regarding management of the rights to such work.
Manufacturing, assembling, transforming, distributing, importing, exporting, selling or leasing out equipment when knowing, or having grounds to know, that such equipment may de-activate technical solutions applied by the copyright holder to protect copyright in his or her work.
Making and selling a work with a forged signature of the author of such work.
Importing, exporting or distributing copies of a work without permission from the copyright holder.
With highly professional staff and great experience in Copyright and Related right aspect in Vietnam and other countries in the world , ANT Lawyers would like to support and represent the clients in protecting copyright and related right.

Source: ANTLawyers.vn

Thứ Ba, 27 tháng 6, 2017

How To Protect Trademark in Vietnam?

BY Juna Mèo No comments

Trademark protection in Vietnam is initially obtained through trademark registration.
Trademark opposition could be filed to prevent a pending application for a mark from being granted application.  Litigation is the final measure to handle dispute during trademark protection in Vietnam.
Trademark is a sign that help distinguish the goods or services of one enterprise from those of others. Together with industrial design and patent, trademark of goods and services plays an extremely important role for the growth of the enterprise. Trademark establishes a link between enterprise and customer.  A strong trademark will attract customers to use goods or services. When trademark is popular and economic benefits achieved through sale of goods or provision of services coupled with trademark is large, the violation of trademark is inevitable.
The annual reports of the Vietnam National Office of Intellectual Property (NOIP) prove that trademark violation in Vietnam is the most popular, among other industrial property rights.  According to the preliminary annual report in 2011, and 2012, there has been more than 1,000 cases of trademark violations each year.  Report of 2013 and after shows more than 2,000 trademark infringements were handled with the total fines of trademark violators of around USD 1 million per year.  Having said that, it is important for trademark owner to register trademarks in Vietnam for better protection.  This is also suggested for even well-known trademarks.
For registration, trademark owner has two options: either directly register trademark in Vietnam by filling an application for registration with the Vietnam NOIP, or seek the protection in Vietnam through Madrid’s system.  For the first option, the trademark owner needs to prepare, file for registration, and pay fee as the requirement of Vietnam Intellectual Property law.  In case trademark needs to be protected in a number of nations, including Vietnam, trademark owner may register trademark through Madrid’s system.
Where the violation of trademark occurs, trademark owner needs to judge the level of infringement, level of damage to choose suitable resolutions.  Initially, the trademark owner may protect by requiring to the trademark violator to terminate the infringing acts, apologize, and rectify. In case of being damaged, trademark owners have rights to claim compensation.  If failing to reach result, trademark owner may use settlement mechanism through negotiation or mediation or could request the competent state agencies to handle acts of infringement through i.e. filling a denunciation application and submitting to the Vietnam NOIP.  Litigation might be required to handle acts of infringement.  Generally, the proceeding of civil litigation is more complex than the arbitration proceeding. In cases the trademark owner needs a decision from court in order to end trademark infringement, civil litigation is top priority. In the remaining cases, arbitration is a better choice with advantages of cheaper cost, shorter settling time, and more flexible.
Learn more about our ANT Lawyers Intellectual Property practice, its experience, and team members here.
Please contact our trademark attorneys in Vietnam for advice via email ant@antlawyers.vn or call us at +84 912 817 823.
Let ANT Lawyers help your business in Vietnam.


Thứ Năm, 22 tháng 6, 2017

Differences Between Limited Liability Company and Joint Stock Company

BY Juna Mèo No comments

How to distinguish a Limited Liability Company and a Joint Stock Company?
Vietnam Law allows the establishment of a company in Vietnam in various forms. It is an important step in investment process.
Investors could choose different forms depending on the needs and capacity on the ability to raise capital and sharing the risk in business as well as the management and operating costs. Each form will have its own organizational structure, operating mechanism, rights and obligations specified under Law on Enterprise 2014.


Currently, Limited Liability Company (“LTD”) and Joint Stock Company (“JSC”) are two popular enterprise forms operating inVietnam.
What is the difference between these two forms of companies?
I. Organizational Structure
Number of members/shareholders:
LTD
·         Single member LTD: Having only one member (member can be an organization or an individual);
·         Multi members LTD: Having at least 2 members and not exceed 50 members (member can be an organization or an individual).
JSC
Joint Stock Company has at least 3 shareholders and not limit the maximum number.
Management structure
LTD
·         Single member LTD
Single member LTD owner by an organization shall be organized under two models: Company president, Director/General director and Supervisor; (OR) Members Council, Director/General director and Supervisor.
Single member LTD owner by an individual shall be organized as follows:  Company president, Director/General director.
·         Multi members LTD
Multi members shall be organized by: LTD Council members, Chairman of the Members Council and Director/General director;
Multi members LTD having 11 members or more shall establish the Board of Supervisors.
JSC
JSC can be organized under two models: General Meeting of Shareholders, Board of Directors, Board of Supervisors and Director/General director; (OR) General Meeting of Shareholders, Board of Directors (Board of Internal Supervisors under Board of Directors) and Director/General director.
II. Capital Contribution
Raising capital
LTD
·         Single member LTD: Owner increases charter capital
·         Multi members LTD: Members increase their charter capital, or increasing the number of capital contributors
JSC
Different from LTD, JSC can raise its capital by various methods as follows: Selling shares to existing shareholders; Selling shares individually to non-shareholders; Issuing shres on the stock market.
Transfer of contributed capital
LTD
·         Single member LTD: Owner transfers a part of contributed capital to other persons and this could lead to changes of the type of business or other procedures if all capital is transferred (for instance in a M&A deal).
·         Multi members LTD: Offer the stakes to other members in proportion to their stakes in the company under the same conditions;  The stakes could only be transferred to other persons if the members do not buy or do not buy completely within 30 days from the offering date.
JSC
The shareholders of JSC are free for transfer their contributed capital after 03 years from the establishment.
Having said that, LTD is a type of enterprise that the capital contribution is not the only link between the members of the company but they are also linked together by relationship. They may be acquaintances and trust each other to jointly contribute capital to establish an enterprise. Therefore, the management of the LTD is as complicated as JSC. With the larger the number of shareholders, the level of capital mobilization, voting power to decide on issues of the company based on the ratio of capital contribution of each shareholder, the management and operation of the JSC is more complex.
The ability to raise capital of a JSC is higher than a LTD. Because, JSC can issue shares to the public in the form of securities. When the stocks are listed on stock exchange, the information of company’s business operations must be public and more transparent.
The procedure to set up a company in form of an LTD or a JSC has not much differences.