Shareholders Dispute

Shareholder disputes can have significant consequences, causing operational and financial setbacks as well as severe damage to companies’ reputation. Disagreements among key individuals within organizations have a detrimental impact on operational performance.

Law firms commonly handle various types of shareholder disputes. One type arises when shareholders believe that the management team has breached their fiduciary duties. This can occur when decisions are made that do not align with the best interests of shareholders or when conflicts of interest or self-dealing occur.

Another type of shareholder dispute occurs when there is disagreement on how the company should be run, particularly during changes in control such as mergers or acquisitions. In these situations, new management may implement changes that shareholders do not agree with.

Dispute resolution becomes necessary when shareholders feel they have been unjustly deprived of their rightful share of profits or assets due to misconduct, mismanagement, or fraudulent actions by the management team.

Shareholder disputes are complex, involving various legal, financial, and individual issues. Recognizing this complexity, our attorneys have honed their analytical and investigative skills to provide excellent forensic services. With a deep understanding of financial matters, we employ proven methodologies to identify underlying issues that may not be immediately apparent. Our legal expertise, financial fluency, and strategic thinking are essential in examining facts and constructing compelling cases tailored to our clients’ specific needs.

We excel in presenting and defending arguments, employing the most advantageous approach, whether it calls for assertive actions or amicable tactics. Our team possesses the necessary confidence and skills to navigate mediation, negotiation sessions, and trials effectively.

At Le & Tran, we have represented companies and individuals in cases of significant value and importance. Guided by our unwavering commitment to justice, we stand ready to represent all parties involved, including majority or minority shareholders, directors, and other interested stakeholders. With a proactive and tactful approach, we are dedicated to protecting your interests throughout the process.

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.

The lawyer 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. The lawyer 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?

With over 20 years of experience as a leading law firm, Le & Tran is proud to offer hands-on legal advice to our clients based on our extensive industry knowledge. Our deep understanding of industry-specific laws allows us to effectively communicate with our clients in various sectors such as aviation, corporate, finance, sales, and distribution.

When it comes to examining facts and constructing a strong case, our legal expertise is invaluable. We provide clients with financial fluency and strategic thinking, empowering them to make informed decisions tailored to their specific needs.

Le & Tran has successfully represented companies and individuals in high-stakes cases of significant value and importance. Our sharp investigative skills, combined with our ability to present and defend arguments, position our clients favorably in dispute resolution matters. Above all, we are committed to serving justice by taking a proactive approach to protect our clients’ 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.