By 2021, a case added to terminate membership in a general partnership

Specifically, in Article 185 of Enterprise Law 2020 has pointed out the regulations of termination membership in general partnership as follows:

1. General partner will be terminated in the below cases:

a) Voluntarily withdrawing the capital out of the company;

b) Being dead, lost or restricted or lost civil act capacity, Cognitive impairment,Cognitive control;

c) Getting fired from the company; 

d) Being in jail, getting banned from jobs by the Law Court or doing a job assigned by the regulation of law;

dd, Other cases following in accordance with the company regulation;

2. A general partner has the right to withdraw capital from the company if accepted by the Boad of member. In this case, the partner who wants to withdraw capital must issues a document of withdrawal of capital at least 6 months from the withdrawal date; withdrawal time must be at the and of Fiscal year and Financial Statement of that final Fiscal year;

3. General partner being fired from the company as the below cases:

a) Being not affordable to invest or not invest as commitment after the second request from the company;

b) Having a violation regarding to Article 180 in this law;

c) Running illegal or careless business or having other acts that cause so much damage to the business benefit and other members;

d) Not following the responsibility of a general partner;

4. In case of termination membership in a general partnership who is restricted to control and behave as normal, have problem in recognization or behavior, their capital will be refund fairly and adequately;

5. Within a duration of 2 years from the termination date of general partner in accordance with the decision at clause 1, point a, c and d, dd of this Article, that person will have joint responsibility by all their assets to the company's debt during the time that person still being the member of the company;

6. After terminating membership, if these members' name has been used in the company, the membership or their heir or their legal representatives have the rights to stop the company using their name;

As such, Enterprise Law 2020 has supplemented the provision: " the general partner being in jail, being banned from jobs or doing a job assigned by law will be terminated membership in general partnership". In fact there are some cases that the partner is in temporary jail, sentenced to prison or withdrawn from the Practice of Law. However, Enterprise Law 2015 does not have any provisions regarding to this case so it is hard to apply in reality. Thus, the business has been affected.

 This Law will take effect on the first of January, 2021.

 Enterprise Law No.68/2014/QH13 will be expired from by the time this Law takes effect.