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Procedures for establishing a social enterprise

Social enterprise is a typical term for businesses operating for community purposes, this concept has appeared for a long time but has only been recognized since the Enterprise Law 2020. What are the documents and procedures for setting up a social enterprise? What criterias need to be met? T2H Lawyers will answer for you in this article.

  1. A social enterprise must satisfy the following criteria:

a/ Being an enterprise registered for establishment in accordance with this Law;

b/ Operating for the objective of solving social and environmental issues in the community interest;

c/ Using at least 51% of its total annual after-tax profits for reinvestment to achieve the registered objective.

2. Dossier

Dossier, order and procedures for registration of the establishment of a social enterprise, branches, representative offices and business locations of social enterprises shall be carried out corresponding to each type of enterprise. Attached to the application is a commitment to achieve social and environmental goals, signed by the following people:

a) For a private company: the owner of the private company;

b) For a partnership: partners;

c) For a limited liability company: members are individuals; legal representative or authorized representative for members being organizations;

d) For joint stock companies: founding shareholder is an individual, other shareholder is an individual, if this shareholder agrees with the content of the above commitment and wishes to sign this commitment together with the founding shareholder. create; legal representative or authorized representative for founding shareholders being organizations, legal representatives or authorized representatives for other shareholders being organizations, if such shareholder agrees with the content of the above commitment and wish to sign this commitment together with the founding shareholders.

3. Responsibilities of social enterprises

  1. Social enterprises shall maintain social and environmental objectives, profit levels retained for reinvestment, and other contents stated in their commitment on fulfilment of social and environmental objectives throughout their operation duration. In case of terminating social and environmental objectives prior to the end of the committed time limit, a social enterprise shall refund all incentives and aid and donation amounts it has received for fulfilment of the registered social and environmental objectives if it fails to implement or fully implement the commitment on fulfilment of social and environmental objectives and the profit level retained for reinvestment.
  2. Owners of sole proprietorships, partners of partnerships, members of limited liability companies, and related parties being shareholders of joint stock companies, members of Boards of Directors, and Chief Executive Officers shall take joint responsibility for the damage caused by their social enterprises’ violation of Clause 1 of this Article during their term of office or related working periods.

T2H LAW LIABILITY LIMITED COMPANY 
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Phone: 0242 242 9900 – 0989 656 682
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Email: contact.t2h@t2h.vn – huong.le@t2h.vn

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