You need to carefully prepare the selection of partners for cooperation, prepare the field of operation, registered capital of the enterprise, and the intended address of the enterprise. Below is some information to help you understand the procedure for establishing a joint stock company quickly, simply, and avoid wasting time. During the research process, if you have any questions, please contact Viet My for detailed advice!

1. Advantages and disadvantages to note when choosing the type of joint stock company

• You can easily raise capital by issuing stocks, bonds and participating in the stock market.
• A joint stock company only requires a minimum of 03 shareholders at the time of establishment and does not limit the number of shareholders participating.
• The company’s other financial obligations are all included in the owner’s equity, so the level of risk for shareholders is not high.
• The operating capacity of a joint stock company is very broad in most fields and sectors.
• Easy to move within the company without having to notify the Department of Planning and Investment. Changes in information of founding shareholders are only notified in 2 cases: “In case the founding shareholder has not paid or only paid a part of the registered shares”. According to the new regulations, when the founding shareholder has contributed enough capital as prescribed, he/she will be registered “forever” during the operation of the joint stock company with information on the initial capital contribution, including: transfer, donation or inheritance. This is an advantage but also a disadvantage when the transfer of shares of founding shareholders will be registered in the internal register of the company like the previous common shareholders.
• This will make the founding shareholders face greater risks because it is necessary to keep records of their share transfer to exempt them from all legal liability in case of risk.
• Difficult to manage shareholders participating in the company because the free transfer does not require steps with the Department of Planning and Investment;
• In case a shareholder of a joint stock company wants to transfer shares, even if the transfer is not profitable (taxable), the tax rate of 0.1% will be applied at the time of the final tax declaration.
• The cumbersome management structure, the unlimited number of largest shareholders and the right to freely transfer shares make it difficult to provide timely management instructions in response to market changes. On the other hand, in the world, due to such corporate characteristics, joint stock companies (especially listed companies) often change owners (bosses, even managers). On the other hand, the management and operation of a joint stock company is very complicated due to the large number of shareholders, many of whom do not know each other, and are even divided into many groups of shareholders with conflicting interests.
• The responsibility of the Board of Directors of a joint stock company is quite large when it comes to internal procedures in the operation of a joint stock company.
• Some specific industries related to reputation and professional responsibility will not be allowed to establish joint stock companies such as: auditing services, accounting services, law, etc.
• After the founding shareholders transfer capital, shareholders who buy shares of the company will not have their names in the company registration system but will only be registered in the internal register and shareholder book of the company.

2. Detailed conditions for establishing a joint stock company

Conditions on the number of shareholders contributing capital to a joint stock company: To establish a joint stock company, there must be at least 3 founding shareholders, with no limit on the maximum number of shareholders. Thus, during the operation of a joint stock company, there must always be at least 03 shareholders.

Conditions for naming a company: The company name must not be the same or confusing with the name of a previously registered company nationwide. If the company name is different from the type of enterprise, it is still considered to have the same name.

Conditions for registering a company headquarters: When establishing a joint stock company, there must be a transaction desk. According to regulations, it is not allowed to register the head office in an apartment building or collective house. If the address is a private house, it is not necessary to provide a notarized copy of the land use rights certificate. In case the customer is located in a commercial building, please provide a construction decision or construction permit.

Industry conditions

• When establishing a joint stock company, the industry must comply with the rules of the national economic system.
• For conditional employment, the following conditions must be met to establish: Registered capital and business certificate of eligibility to operate.
• Currently, enterprises are not required to meet the requirements for certification or sub-licenses when registering to operate, but must comply with these conditions when operating. Some industries that require legal capital such as labor export, postal services, insurance, and securities require the company to register a minimum charter capital equal to the legal capital.
• However, there is no obligation to prove capital when applying to establish a securities company.

Charter capital:

• Share capital is the information that most companies are interested in when registering because it is directly related to the financial obligations of shareholders during the company’s operations. According to current regulations, the time for shareholders to fully implement the registered capital is 90 days from the date of issuance of the Certificate of Company Registration. After this period, if the shareholder has not paid or only paid a part of the registered shares, the company must amend the information of the founding shareholder and reduce the capital contribution within 30 days from the last day of full payment.
• In addition, the company’s registered capital is also linked to the amount of business license tax payable.
• A joint stock company can reduce its share capital according to the decision of the general meeting of shareholders, the company will return a part of the capital contribution to shareholders corresponding to their participation in the company if the company continues to operate. continuously operating for 02 years or more from the date of company registration and ensuring payment of debts and other property obligations after returning to shareholders, except in cases where the company buys back the shares sold according to the provisions of Sections 132 and 133 of the Enterprise Law and the Charter of capital that has not been fully and timely paid by shareholders as required by Article 113 of the Enterprise Law.

Regulations on representatives

The representative of a joint stock company can be the representative of many different enterprises. However, there are 02 cases where the following representative will not continue to be the legal representative of the joint stock company:

• The company representative has a suspended tax code: meaning that during the operation, the company does not declare taxes, does not fulfill tax payment obligations, does not carry out activities but does not carry out notification procedures with the company registration agency and ceases business.
• According to the regulations on the management of joint stock companies, there are limitations: The Chairman of the Board of Directors cannot combine the function of Director (Executive Director) with the role of representative of the same joint stock company (also a joint stock company).

Conditions for members of the Board of Directors of the Corporation: Members of the Board of Directors of the Corporation can concurrently be members of the Board of Directors of another company.

However, the director of a joint stock company cannot concurrently be the director of more than 5 other companies.

3. Minimum capital to establish a joint stock company in 2024

If your company registers to operate in a normal field of operation that does not require legal capital, the law does not stipulate a minimum capital level to establish a joint stock company. Because the list of registered industries is quite long, you can refer to the list of registered industries below:

In fact, many business units have registered a registered capital of 1 million VND to establish a joint stock company up to tens of millions of VND. This is not prohibited by law. However, when registering such a low registered capital, when transacting and working with partners, bank branches, and tax authorities, they often do not trust and limit transactions. Therefore, registering too low a capital of a joint stock company is a major obstacle. Therefore, it is necessary to register an appropriate registered capital level to facilitate business transactions.

In case your joint stock company registers for a business line that requires legal capital to operate, the minimum capital to establish a joint stock company is equal to the level prescribed for that line of business.

4. Detailed procedures for establishing a joint stock company in 2024

In fact, when establishing a joint stock company, all companies must follow the procedures for establishing a joint stock company as follows:

4.1 Dossier for establishing a joint stock company

• Citizen identification card/ID card/Passport of all shareholders contributing capital to establish a joint stock company (notarized within 3 months)
• Draft a sample application form for establishing a joint stock company.
• Joint stock company charter
• List of shareholders contributing capital
• Authorization letter for individuals/organizations to represent and carry out the procedure.

4.2 Detailed procedures for establishing a joint stock company in 2024

Step 1: Collect information

To carry out the procedure for establishing a company, you only need to prepare 01 notarized copy of ID card/ID card/passport/business registration certificate/business registration certificate (if the shareholder is an organization) and the following information: Information about shareholders: company name, address, charter capital, business lines, legal representative.

Step 2: Draft documents

Step 3: Submit application for business registration certificate and pay business information disclosure fee

• Documents for establishing a joint stock company and social information disclosure fee will be submitted with the documents after having the signature of the shareholder according to regulations.
• The documents are submitted to the Business Registration Office – Department of Planning and Investment where the company is headquartered.
• The time limit for issuing a business registration certificate is 03 working days.

Step 4: Carving the company seal

After receiving the company registration certificate, the seal will be made.

Currently, enterprises do not need to advertise the seal sample before using the seal. Enterprises have the right to decide on the form, quantity and content of their seal.

Therefore, according to this new regulation, the form of the seal chosen and decided by the company only needs to ensure the minimum information mentioned above and does not need to carry out the procedure of announcing the seal sample before use. However, to ensure consistent use of the company seal, we recommend that companies use a plain seal mold (circular) and do not leave information about the district where the company is headquartered later if the company wants. If the company changes its registered office to another district, it is not necessary to re-carve the company’s legal seal.

In addition, according to the provisions of the Enterprise Law 2020, a joint stock company is entitled to carve multiple seals to serve its business activities. In case the company needs to carve a second corporate seal, Viet My will guide and support the company to complete the process of carving the second seal.

Step 5: Company shareholders contribute seed capital.

Step 6: Complete the following steps to establish a business.

• Open a company bank account.
• Register for electronic tax payment and electronic signature to declare taxes online.
• Produce and hang a signboard for the head office.
• To pay taxes electronically, purchase an electronic digital signature.

The above article is the procedure for establishing a joint stock company. To avoid potential legal risks, customers can use the company establishment service of VIET MY LAW AND ACCOUNTING. We are committed to providing you with a cost-effective, fast and accurate company establishment service.