Procedures for increasing charter capital of a LLC with two or more members

Procedures for increasing charter capital of a LLC with two or more members is a procedure that must be followed when there is a change in charter capital. This not only demonstrates financial capacity but also builds credibility with partners and customers. This article by Long Phan will provide detailed information about the forms, documents, and procedures for increasing charter capital of LLCs with two or more members, helping customers understand and implement effectively.

Forms of increasing charter capital of limited liability companies with two or more members

According to Clause 1, Article 68 of the Law on Enterprise 2020, there are two main forms to increase the charter capital of a LLC with two or more members:

• Increasing capital contributions of current members: This is the most common form, in which current members of the company contribute additional capital to the company. This additional capital contribution will be divided among the members in proportion to their capital contribution in the company’s charter capital. Members can also transfer their capital contribution rights to others.
• Receiving additional capital contributions from new members: This form allows the company to attract more capital from new investors.

In case a member does not contribute or only partially contributes additional capital, the remaining capital will be divided among other members in proportion to their capital contribution, unless otherwise agreed.

>>> See more: Procedures for Establishing a LLC with Two or More Members.

Benefits of increasing charter capital for LLCs with two or more members

Increasing charter capital not only improves the financial situation of the enterprise but also brings many other benefits. Specifically the following benefits:

• First, high charter capital builds prestige and trust from customers and partners.
• Second, businesses with high charter capital can more easily access loans from banks, helping to expand business activities.
• In addition, increasing charter capital also creates favorable conditions for the company’s stable and effective development. Increased charter capital provides financial resources for businesses to invest in new projects, expand production and business scale, or improve competitiveness in the market.

Documents for increasing charter capital of a LLC with two or more members

Documents to increase charter capital of a limited liability company with two or more members include:

1. Notice of change in business registration content (form Appendix II-1 issued together with Circular 01/2021/TT-BKHDT).
2. List of members of limited liability companies with two or more members (form Appendix I-6 issued with Circular 01/2021/TT-BKHDT) in case the change in charter capital is accompanied by a change in the capital contribution ratio between members.
3. Decision of the Board of Members on changing the company’s charter capital.
4. Minutes of the meeting of the Board of Members on changing the company’s charter capital.
5. Document from the Investment Registration Authority approving the capital contribution and capital contribution purchase of foreign investors and foreign-invested economic organizations in cases where capital contribution registration and capital contribution purchase procedures must be carried out according to the provisions of the Law on Investment.
6. Authorization document for the person to submit the application and receive results if not the legal representative. This document is not required to be notarized or authenticated.
7. Valid copy of one of the personal identification documents of the person authorized to perform the procedure (if any):

• For Vietnamese citizens: Citizen identification card or ID card or valid Vietnamese Passport.
• For foreigners: Foreign passport or valid document replacing a valid foreign passport.

Procedures for increasing charter capital of a LLC with two or more members

The procedure is performed as follows:

Step 1: Submit application

• Submit the application directly or via postal service to the Business Registration Office where the company is headquartered;
• Or submit your application online at the National Business Registration Portal at: https://dangkykinhdoanh.gov.vn and pay fees and charges (if any) and receive a receipt for processing the application.

Step 2: Process documents and issue business registration certificate

Within 03 working days from the date of receiving the dossier, the business registration agency completes the resolution and returns the results if the dossier is valid. In case the application is not valid, the Business Registration Authority must notify in writing the content that needs to be amended or supplemented to the applicant.

Note: After being granted a Certificate of change in business registration content, a limited liability company with two or more members must submit documents to the tax authority if changing the license tax rate and publicly announce it on the National Business Registration Portal.

>>> See more: Instructions for reducing charter capital of limited liability companies with 2 or more members.

Guidance service on procedures for increasing charter capital of LLCs with two or more members

In order for the process of increasing charter capital to take place quickly and effectively, customers can seek support from Long Phan Consulting Company. With extensive experience and expertise in this field, we provide comprehensive consulting and support services, including:

• Consulting on legal regulations on increasing charter capital of limited liability companies with two or more members.
• Consulting on plans to increase charter capital effectively and in accordance with the actual situation of the business.
• Consulting on procedures for increasing charter capital of LLCs with two or more members.
• Drafting documents to increase charter capital for limited liability companies with two or more members.
• Business representatives submit applications and work with competent state agencies.
• Monitor the process of processing documents and notify the business of results.
• Resolve legal issues that arise during the process of implementing procedures to increase charter capital.

Frequently asked questions about procedures for changing charter capital of LLCs with two or more members

Customers can refer to the frequently asked questions below:

Is the charter capital of a limited liability company with two or more members required to increase?

Increasing charter capital is not mandatory, but depends on the company’s needs and development strategy. However, increasing capital can bring many benefits such as increased reputation and ability to access loans.

How long does it take to complete the procedure to increase charter capital?

According to regulations, the time for the business registration agency to process documents and issue a new business registration certificate is 03 working days from the date of receipt of valid documents.

Can members contribute capital not according to the current capital contribution ratio?

Yes, members can agree to contribute capital not according to the current capital contribution ratio, but this agreement must be clearly stated in the decision of the Board of Members.

Can I submit an application to increase charter capital online?

Yes, businesses can submit online applications through the National Business Registration Portal.

Things to note when increasing charter capital with non-cash assets?

When increasing charter capital with non-cash assets, a valuation certificate from an organization with valuation function is required to determine the value of contributed assets.

How will the case of increasing charter capital without notifying the competent authority of the change be handled?

If an enterprise does not notify a change in charter capital, it will be subject to administrative fines according to the provisions of law.

What content should be included in a decision to increase charter capital?

The decision to increase charter capital must clearly state the amount of charter capital increased, the method of increasing capital and the capital contribution ratio of members.

Conclude

Increasing charter capital is an important decision for the development of a LLC with two or more members. Customers should carefully study the legal regulations and prepare complete and accurate documents to ensure the implementation process goes smoothly. If you have any questions or need more detailed advice, please contact Long Phan Consulting Company via the hotline: 0906735386.