Shareholders Dispute

Business is deemed a machine, which works efficiently if all pieces of this machine are operated and run smoothly. Therefore, shareholder disputes, which are considered as an error of the business operation, are likely a familiar reason leading to operational and financial setbacks and severe damage to many companies. Disagreements amongst individuals holding critical roles in the companies cause detrimental effects on the operational performance and reputation.

There are a few different types of shareholder disputes that law firms typically handle. The first is when shareholders believe that the management team has breached their fiduciary duties to the shareholders. This can happen if the management team makes decisions that are not in the best interests of the shareholders, or if they engage in self-dealing or conflicts of interest.

Another type of shareholder dispute arises when there is a disagreement about how the corporation should be run. This can occur when there is a change in control of the company, such as a merger or acquisition, and the new management team tries to implement changes that the shareholders do not agree with.

Dispute resolution may also be necessary when shareholders believe that they have been cheated out of their rightful share of profits or assets by the management team. This can happen through fraud, mismanagement, or other forms of misconduct.

Shareholder disputes become complicated and challenging due to a complex mix of issues regarding individuals, legal and financial matters. With that understanding, our attorneys have sharpened our analytical and investigative skills to perfect our forensic services. Equipped with financial knowledge, we have known methodologies of issue discovering and identifying in depth, especially where issues are not rapidly apparent on the surface. Our legal expertise, financial fluency, and strategic thinking are valuable when it comes to inspecting the facts and building a compelling case, tailored to our clients’ request.

We also become adept at presenting and defending our arguments. Whether tough actions or amicable tactics are demanded, we are ready to employ the most advantageous approach. We have confidence and skills to navigate and coordinate mediation, negotiation sessions and trials.

Le & Tran has acted for companies or company personnel also in cases of significant value and importance. Guided by our belief in justice, we are prepared to represent any involved parties, i.e., majority or minority shareholders, directors, and interested third parties. Proactive in our approach and tactful in our execution, we are here to protect your interests.

What is a shareholder dispute law firm?

A shareholder dispute law firm specializes in representing shareholders who have disputes with their company while providing comprehensive legal services. Dispute resolution can be incredibly complex and the stakes are often high, so it is important to have an experienced law firm on your side that can navigate the complexities of these types of cases.

If you are involved in a shareholder dispute, you need an experienced law firm with a lawyer on your side who can help you navigate the legal landscape and protect your interests.

What do shareholder dispute lawyers do? 

A shareholder dispute attorney represents shareholders in disputes with the management of a company. The attorney from a shareholder dispute law firm will discuss with the client to understand the specific details of their case and craft a legal strategy that is tailored to their unique needs.

He or she will work with companies and individuals to try to reach amicable agreements between shareholders. They collaborate closely with the board of directors, and sometimes with external advisors. They are responsible for keeping you updated on the status of your case and any developments that may impact the outcome. In addition, they will work with experts in other fields, such as accounting or finance, to provide a complete picture of your case. Other benefits of hiring a shareholder dispute lawyer are:

  • To protect the client’s interests
  • To ensure that the rights of the clients are respected
  • To avoid costly litigation
  • To obtain compensation
  • To achieve a fair outcome

When a shareholder dispute lawyer is sought for legal counsel, it is his or her responsibility to examine the claim and advise the client on the next course of action. In order to execute this, the lawyer must have access to all relevant documentation given by the client and form an opinion on the client’s chances of success. He or she may advise the client on whether their claim makes for a strong case or otherwise.

Shareholder dispute lawyers issue court proceedings and handle disclosure and drafting of witness statements. They prepare the necessary trial documentation required as well as request for Counsel to attend the trial.

Dispute resolution lawyers will attend settlement or mediation meetings. Attempts will be made to an agreement with all parties involved. Depending on the law firm, they may also advocate for clients at interim court applications, pre-trial hearings and case management conferences.

The lawyer will attend conferences with Counsel and the client to review the case and prepare for trial. In trial proceedings, the lawyer will assist with any queries about the client’s case and ensure that he or she understands what is happening during the course of the trial.

What is Vietnam’s shareholder dispute law like?

Vietnam’s shareholder dispute law is according to the Law on Enterprises which regulates the establishment, operation and governance of corporate entities. It is the main law for the regulation of companies in the country. The Law on Enterprises was adjusted in 2020 to strengthen protection for shareholders. Some of the changes include:

Removed requirement to appoint an official controller

A single-member limited liability company that is owned by a member and multi-member limited liability organization that is owned by more than ten members is not required to appoint a board of controllers.

Thorough regulations on corporate bond issuers and investors

Vietnam’s Law on Enterprises is more thoroughly regulated with detailed conditions for issuance of bonds by private joint stock companies, issuance process and transfer of bonds being provided under guiding decrees.

Enabling multiple member liability organizations to issue bonds

The Law on Enterprises now allows for multiple member liability companies to issue bonds.

Enhanced protection for minority shareholders

Any shareholder or group of shareholders with a minimum 5% of ordinary shares will be given rights similar to shareholders holding 10% of it, except for nominating members to the Board of Directors or Board of Controllers. There will also be no minimum ownership period for shareholders to hold their shares before exercising general shareholder rights.

Improved rights of preference shareholders

Statutory protection is given to preference shareholders by allowing them to have limited participation rights, such as attending and voting in shareholder meetings where proposals may negatively affect their rights and obligations.

Reduced minimum voting threshold

There is a minimum voting threshold of more than 50% for shareholders to approve non-critical matters at meetings, while the minimum voting threshold by shareholders to approve critical matters remains at 65%.

Amended private placement procedures

Existing shareholders must be provided the opportunity to exercise their right where a private joint stock company seeks to issue new shares, not including the issuance of shares in connection with amalgamations or mergers.

Why engage shareholder dispute lawyers from Le & Tran?

As a leading law firm that has been in business for more than 20 years, we at Le & Tran pride ourselves on being able to provide clients with hands-on legal advice from our extensive experience and knowledge of the industry. Our deep understanding of the laws governing each industry enables us to speak the language of our shareholder dispute clients’ businesses, whether it be aviation, corporate, finance or sales and distribution.

When it comes to inspecting the facts and building a compelling case, our legal expertise is invaluable. We are able to provide clients with financial fluency as well as strategic thinking so they can make educated decisions tailored specifically towards what you need.

Le & Tran has acted for companies or company personnel in cases involving significant value and importance. Our sharp investigative skills paired with our aptitude in presenting and defending arguments puts our dispute resolution clients in the best possible position to succeed. Most importantly, we believe that justice is served when we represent any involved parties with a proactive approach to protecting their interests at all costs.

Learn more about Le & Tran’s other practices such as commercial contracts and labor law, or get more information about commercial and corporate litigation.