A Vietnamese company is bound by a contract signed by its legal representative, or by another person holding a valid written authorisation from the company, acting within that authority and within any internal approvals required by the Enterprise Law and the charter. A company seal is no longer a strict legal requirement for most contracts, but many Vietnamese businesses still expect it, and the charter may require it.
Signing defects are among the most common reasons a Vietnamese counterparty later argues that a contract does not bind it. This guide explains who can sign, how to verify authority, when the seal still matters, and a short checklist for foreign companies before any significant signing.
The legal representative and why it matters
Every enterprise in Vietnam has at least one legal representative, registered in the national business registration system. The legal representative exercises the company's rights and obligations in transactions, represents it before courts, arbitration and authorities, and can sign contracts on its behalf. The Enterprise Law allows a company to have more than one legal representative and requires the charter to specify their number, titles and division of powers where there are several.
In a limited liability company, the legal representative is often the chair of the members' council or the general director. In a joint stock company, it is often the chair of the board or the general director. Some companies appoint foreign nationals; the law requires at least one legal representative to reside in Vietnam, and if that person leaves the country, an authorisation to another resident person is needed. Visa and work permit questions for such persons are outside this guide.
Changes of legal representative must be registered, and the registration record is what outsiders are expected to check. A person removed internally but still shown on the portal, or appointed internally but not yet registered, creates uncertainty. When you see a recent change, ask for the resolution and the updated certificate.
For a foreign counterparty, the starting point is simple: find out who is registered as legal representative, and either have that person sign or obtain a valid authorisation from them.
How to check the registered legal representative
You can verify basic company information without relying on the counterparty's word:
- Search the company on the national business registration portal using its name or enterprise code, and note the legal representative, registered address and status.
- Ask for a copy of the latest enterprise registration certificate and compare it with the portal.
- Ask for the company charter, or at least the provisions on legal representatives and approval thresholds.
- If there are several legal representatives, ask which one has authority for the type of contract you are signing.
- For high-value deals, request an extract or certified copy of registration information through official channels.
- Check the person's identity at signing against their ID or passport, discreetly but carefully.
These checks take minutes and catch the most common problems: a recent change of legal representative not yet reflected in the counterparty's paperwork, or a manager who presents himself as director without being registered.
Keep screenshots or printouts of what the portal showed on the day you checked, with the date. If the counterparty later disputes who was in charge, a dated record of the public registration at the time of signing is useful evidence that you relied on official information in good faith.
Authorisation: when someone else signs
Legal representatives frequently authorise others to sign: a deputy director, a branch manager, a sales director. The authorisation should be in writing, issued by the legal representative or the company in the correct form, and should state the scope, such as which contract or which types of contracts, value limits and duration. A person signing beyond the scope of authority may not bind the company, unless the company later approves the transaction or the circumstances meet the conditions under which the law treats it as bound.
Branch and representative office heads are a frequent source of confusion. A branch can carry out business on behalf of the company within the scope of authorisation; its head usually signs under an authorisation from the company. A representative office is limited to liaison and promotion, and generally cannot sign commercial contracts generating revenue in its own right. If a "representative office" signs a sales contract, ask for the parent's authorisation.
Ask for a copy of the authorisation before signing and keep it with the contract. If the authorisation has an expiry date, check that it covers the signing date. If the contract will be signed in counterparts or electronically, make sure the authorisation covers that method.
Internal approvals that can affect validity
Beyond the identity of the signatory, some transactions need approval by a company body. A contract signed without the required approval may be challenged.
| Type of transaction | Possible approval needed | What to ask for |
|---|---|---|
| Large asset purchases or sales above a threshold of the company's assets | Members' council, board or shareholders' meeting, depending on company type and charter | A copy of the relevant resolution |
| Transactions with related parties such as owners, managers or their relatives | Approval by the body specified in the Enterprise Law, with interested persons not voting | Resolution and confirmation of who voted |
| Loans, guarantees and security for third parties | Often specified in the charter as needing approval | Resolution and charter extract |
| Contracts in regulated sectors | Sometimes approval or registration with a state body | Evidence of the approval or registration |
| Routine sales and purchases | Usually none beyond normal authority | Authority of the signatory |
Thresholds differ between limited liability companies and joint stock companies and can be adjusted by the charter. For significant transactions, ask your lawyer which approvals apply and request copies before signing.
Signing scenarios that go wrong
Hypothetical example one: a foreign supplier signs a supply contract with a "director" of a Vietnamese trading company who has a business card and an office. Months later, the company refuses to pay, saying the man was a sales manager with no authority. Because the supplier never asked for an authorisation and the company had not paid any earlier invoices, the supplier faces a real argument that the contract does not bind the company. A two-minute check on the portal and a request for an authorisation would have removed it.
Hypothetical example two: a Vietnamese joint stock company guarantees a loan to a company owned by its chairman. The guarantee is signed by the chairman as legal representative, with the seal, but without the related-party approval the charter and the Enterprise Law require. When the borrower defaults, the guarantor's other shareholders challenge the guarantee. The lender, who never asked for a resolution, now has to litigate a question it could have closed at signing.
Hypothetical example three: a contract is signed by the correct legal representative, but the signature page names a different company in the same group. The parties argue for a year about which entity is bound. Matching the names on the cover page, signature page and seal is not a formality; it decides who you can sue.
Does the company seal still matter?
For years, a contract in Vietnam without the company's red seal was regarded as incomplete. The Enterprise Law of 2020 changed the legal position: companies decide the form, number and management of their seals, and seals no longer have to be notified to the registration authority. Companies may also use digital signatures. A contract signed by an authorised person is generally valid even without a seal, unless the law or the charter requires a seal for that transaction, or the parties agreed one is needed.
Practice has not caught up completely. Many Vietnamese companies, banks and authorities still expect stamped documents, and some charters require a seal on contracts. For foreign parties, the practical advice is to ask for the seal where the counterparty normally uses one, check that the seal impression matches the company name, and remember that a seal does not cure a lack of authority. A stamped contract signed by someone without authority is still vulnerable.
Control of the seal can become an issue in partner disputes, because whoever holds it can stamp documents that third parties may rely on. If you hold equity in a Vietnamese company, the charter should state who keeps the seal and how it is used.
A pre-signing checklist for foreign companies
Before signing any significant contract with a Vietnamese company, run through these steps:
- Confirm the counterparty's full registered name, enterprise code and address from the official portal.
- Identify the registered legal representative or representatives.
- If someone else will sign, obtain a copy of the written authorisation and check its scope and dates.
- Ask whether any internal approval is required for this transaction, and obtain the resolution.
- Check whether the charter or the contract requires a seal, and if so, ensure it is applied.
- Make sure the name and title of the signatory on the signature page match their actual position.
- Initial every page of all language versions and keep originals or verified electronic copies.
- Keep a signing file containing all of the above in one place.
This list adds perhaps an hour to a signing. It removes the most common defence a counterparty raises when it later wants to avoid a contract.
When you need a Vietnamese lawyer
For routine purchase orders with established partners, the checklist above is usually enough. Bring in a licensed Vietnamese lawyer for acquisitions, joint ventures, large supply or construction contracts, guarantees, security agreements and anything involving related parties or regulated sectors. The lawyer can review the charter, confirm which approvals apply, check authorisations and attend the signing if needed.
If a counterparty has already argued that a contract is invalid because of a signing defect, a lawyer can assess whether the defect is real, whether the company later ratified the contract through its conduct, such as accepting goods or paying invoices, and how a court or tribunal is likely to view the argument.
It also helps to have a lawyer prepare a standard signing protocol for your company in Vietnam: the documents you always request, the approvals you check for each type of contract and the form of authorisation you accept. Sales teams can then follow it without calling legal on every deal, and exceptions stand out immediately.
Rules on legal representatives, authorisation and seals have changed over the past decade, and charters vary widely. Check the current rules and the counterparty's charter with a licensed lawyer before a significant signing.
Frequently asked questions
Is a contract valid without the company seal in Vietnam?
Generally yes, if signed by an authorised person, because the Enterprise Law 2020 lets companies decide on seal use. A seal may still be required if the charter, a specific law or the contract itself requires it, and many counterparties still expect one in practice.
Can a general director who is not the legal representative sign contracts?
Only if the charter gives that person authority or the legal representative has authorised them in writing. Check the registration record and ask for the authorisation before signing, rather than relying on the title alone.
How do I verify who the legal representative is?
Search the company on the national business registration portal by name or enterprise code. Compare the result with the enterprise registration certificate the counterparty provides, and ask for the charter provisions on representation if the company has more than one representative.
What if the person who signed had no authority?
The contract may not bind the company unless the company later approves it or behaves in a way that confirms it, such as performing the contract. The signatory may be personally liable. Consult a licensed lawyer if this issue arises.
Can a representative office in Vietnam sign a sales contract?
A representative office is generally limited to liaison and promotion and should not itself conduct revenue-generating business. If a representative office head signs, ask for a written authorisation from the parent company and confirm that the parent is the contracting party.
Are electronic signatures accepted for contracts in Vietnam?
Vietnamese law recognises electronic transactions and digital signatures, and many contracts can be signed electronically. Some transactions still require specific forms such as notarisation. Check the requirements for your contract type and make sure the signatory's authority covers electronic signing.