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Question :: I am a member of the Supervisory Commission (the Commission) of a public company which is unlisted and termed from 2007 to 2010. Until now, my term is still valid. In 2009, I was [not] invited to attend any meeting of the company’s Commission. Recently, I also did not attend the Commission’s meeting to produce the Commission’s Report for submission to the General Shareholder’s Meeting (the Meeting) year 2010 on April 9. I was informed that this Commission’s Report was built by the Commissions’ Director (the another member of the Commission also did not attend). I would like to ask you whether the operation of the Commission like that is legal or not? Is the Report mentioned above legal? What should I do to comply with the rights, duties and obligations of a Commission’s member?
Question :: I am a president of the Management Board (“the Board”) of a public company. As per regulations, the term of the Board, Supervisory Commission (“the Commission”) is five (5) years. Therefore, the first term of the Board, Commission is due on November 2010. However, in order to facilitate the voting of the Board, the Commission in the second term, the Board would like to submit the General Shareholder’s Meeting (“the Meeting”) with the latest on April 19, 2010 for renewal of the first term of the Board, the Commission until April 2011. So, the question is that is the renewal true or not? If the shareholders are not taken opinions directly at the Meeting, can the Board collect opinions indirectly from shareholders in writing? If the Meeting does not pass the renewal, how can the voting of the Board, the Commission be taken in compliance with laws?
Question :: Our company registers shares at the Securities Depository Central (SDC), but cannot deposit, of which my 10.000 shares. So, can I transfer directly 2.000 shares to my brother and compliment 2.000 shares to my wife?

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LEGAL NEWS

Contracts in Construction Activities

On 07/5/2010, the Government issued Decree No. 48/2010/ND-CP on Contracts in Construction Activities.

This Decree regulates the for contracts in construction activities with regards to the construction projects that use 30% of the state capital. For construction contracts under the projects using ODA capital, if the international treaties to which Vietnam is a member has other regulations with the provisions of this Decree shall comply with the provisions of the international treaties.

Some points to note in this Decree are as follows:

- Contract price does not exceed the bid price (in case of bidding), not exceeding the approved estimate package (in case of contractor). The adjustment of prices and construction contract adjustment applies only during contract performance under the contracts signed. Where the adjustment does not change the investment objectives or do not exceed the total approved investments, the investors may decide, contrary to reports from the competent authority to decide the investment decision. For package contract, the contract is adjusted only for the additional workload beyond the signed contract.

Decree also specified, the price adjustment contract only applies to contracts under fixed unit price, unit price adjustments and contract over time. This provision creates favorable conditions for investors to compare the regulations for the implementation of the contract price adjustments appropriately, to avoid price fluctuations due to stagnation of build.

- Generally, investors must buy building insurance. Where the premium has been calculated into the contract, the contractor shall buy this insurance. Also, the contractor shall buy the insurance necessary to ensure their activities.

- Decree also stated that the contractor is responsible for warranty work, warranty and equipment in accordance with the agreement. For special projects and grade level, the warranty period of not less than 24 months from the date of acceptance of the works are put into use, the warranty is 3% of contract value. The work remaining warranty period of not less than 12 months, then the warranty rate is 5% of contract value.

Decree takes effect from 01/7/2010 and replace Decree 99/2007/ND-CP dated 13/6/2007 of the Government on contracts in construction activities.