Rights and Obligations of Heads of representative offices or branches of foreign traders in Vietnam

Each foreign business can establish multiple branches and may be the head of the branch and the legal representative is the same person. However, the company may hire one or more people as directors of one or more branches. In this case, what will be the responsibilities and obligations of the head of the branch and representative office?

According to article 33 of No.07/2016/ND-CP specifies Rights and Obligations of Heads of representative offices or branches of foreign trader in Vietnam.

1. Allowed to do

  • The Head of the representative office or branch shall be responsible for his/her action and the operation of the representative office or branch to his/her head office within the power of attorney.
  • The head of the representative office or branch shall be responsible for his/her activities the scope of authorization.
  • In the absence of the head of the representative office or branch from Vietnam, he/she shall grant the power of attorney to another person. The power of attorney shall be made with the prior consent of the head office. However, the head of the representative office or branch shall be responsible for exercising rights and obligations specified in the power of attorney.
  • Upon the expiry of the power of attorney stipulated in clause 3 hereof, if the head of the representative office or branch has yet to return and no additional power of attorney is made, the current authorized person shall be eligible for exercising rights and obligations as the head of the representative office or branch within the scope of authorization until the head of the representative office or branch returns or the head office appoints another person as the new head of representative offices or branch.
  • If the head of representative offices or branch from Vietnam is absent from Vietnam for a period of longer than 30 days without any authorization, or if the head representative offices or branch is dead, missing, detained, sentenced to prison or has no capacity for action, the head office shall appoint another person as the new head of representative offices or branch.
  • If the head office authorizes the head of the representative office to sign, adjust or supplement contracts, the head office shall grant the power of attorney for each conclusion, adjustment, and supplementation.

2.Not allowed to do

The head of a branch shall not concurrently hold the following titles:
  • The head of a representative office of another foreign trader;
  • The head of a representative office of the same foreign trader;
  • The legal representative of a business organization incorporated under Laws of Vietnam.
The head of a representative office shall not concurrently hold the following titles:
  • The head of a branch of the same foreign traders
  • The head of a branch of another foreign trader
  • The legal representative of the same foreign trader or others
  • The legal representative of a business organization incorporated in accordance with Laws of Vietnam.

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