During the process of setting up a joint-stock company, one of the crucial steps not to be overlooked is registering shareholders by creating a shareholder register. This is not only a mandatory requirement under Vietnamese law but also helps businesses transparently and clearly manage the rights and obligations of each shareholder. Failure to comply properly may result in serious legal consequences. In this article, together with FTA LAW, we will explore in detail when the register should be created and the penalties for non-compliance, raising awareness and protecting the interests of both the company and its shareholders.
Image: When should the shareholder register be created?
1. Timing to Create the Shareholder Register
According to Article 122 of the 2020 Enterprise Law, immediately after a joint-stock company is granted the Enterprise Registration Certificate, the company must diligently and accurately establish the shareholder register. This important first step clearly identifies the list of shareholders, their shareholdings, and sets a solid legal foundation for the company’s operations.
1.1. Mandatory Contents
A complete and accurate register must include the following basic information:
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Company information: Full company name and main office address, helping clearly identify the entity managing shareholder records.
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Share information:
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Total shares authorized for offering according to the business registration,
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Types of shares issued (common shares, preferred shares, etc.) with the exact quantity of each type,
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Number of shares sold and corresponding capital contributed for each share.
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Shareholder information:
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For individuals: Full name, contact address, nationality, and legal identification such as citizen ID or passport to ensure transparency.
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For organizations: Company name, business registration number or related legal documents, and head office address.
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Number and type of shares held by each shareholder along with registration date, showing clear shareholding rights.
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1.2. Storage Format
With digital technology development, the shareholder register can now be stored in various flexible formats to ensure security and ease of management:
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Traditional paper format: Easy to access and suitable for companies not yet using electronic management systems.
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Electronic data format: Saves storage space, enhances security, and supports quick access when needed.
1.3. Place to Store the Shareholder Register
The shareholder register must be kept at:
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The company’s head office, where shareholders can conveniently inspect it when necessary; or
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An authorized organization entrusted with safekeeping, helping companies ensure legal compliance and professional management of shareholder records.
Important note:
Shareholders have the right to inspect and copy information in the shareholder register to protect their legal interests. When changes occur regarding address or contact information, shareholders must promptly notify the company to update records, avoiding missing or incorrect data that could affect their rights.
2. Penalties for Failing to Comply with Shareholder Registration Requirements
Failure to establish or maintain the shareholder register timely and fully as required by law constitutes a violation. According to Decree 122/2021/ND-CP, violating organizations and individuals will face strict fines to uphold legal enforcement.
2.1. Specific Fines
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For organizations:
Fines range from VND 30,000,000 to 50,000,000, reflecting not only deterrence but also the severity of the violation. -
For individuals:
Fines range from VND 15,000,000 to 25,000,000, applying to persons responsible within the enterprise.
2.2. Remedial Measures
Beyond monetary fines, companies must recreate the shareholder register and ensure full compliance with relevant laws. Delay increases legal risks, adversely affecting business operations and corporate reputation.
Image: Penalties for failing to create a shareholder register
3. Conclusion
Registering shareholders through establishing a shareholder register is an indispensable legal obligation for joint-stock companies from the moment of establishment. It is an important tool to clarify shareholder rights and enhance corporate governance effectiveness. Non-compliance results in serious consequences, including fines and enforcement measures that negatively impact business operations and reputation.
To ensure accurate and complete register creation and effectively handle arising legal issues, businesses should consult reputable legal advisory units such as FTA LAW. With highly qualified and experienced lawyers specializing in corporate law, FTA LAW commits to accompanying and assisting enterprises in strictly complying with legal requirements, helping clients confidently develop sustainably.
The above content is for reference only and does not constitute official legal advice from FTA LAW’s legal team. For any questions or case-specific advice, please contact us at support@ftalaw.vn – We are always ready to listen and assist you.