VI Contract Signing Authority in Vietnam 2026: 5 Legal Checks
Contract signing authority in Vietnam is an important legal consideration when businesses enter into commercial agreements, service contracts, leases and other transactions. An agreement may be signed by a legal representative, a director, a department manager or another authorized individual. However, holding a managerial position does not automatically mean that the person has the legal authority to bind the company in every transaction.
For foreign-invested enterprises (FDIs) and companies with multiple legal representatives, verifying contract signing authority in Vietnam requires particular attention. A company’s charter, appointment decisions and authorization documents may establish different responsibilities and signing limits.
This article outlines the legal framework and five practical checks that Legal, Procurement, Finance and management teams can undertake before signing a contract. These checks are recommended compliance procedures, rather than five separate mandatory steps prescribed by Vietnamese law.
1. Legal Framework for Contract Signing Authority in Vietnam
The principal legal framework governing representation and contract signing authority in Vietnam includes Civil Code No. 91/2015/QH13, dated 24 November 2015, particularly Articles 134–143 concerning representation.
Another relevant instrument is Law on Enterprises No. 59/2020/QH14, dated 17 June 2020, as amended and supplemented by Law No. 76/2025/QH15, dated 17 June 2025, to the extent applicable.
Under Articles 137 and 138 of the Civil Code, a person’s authority to represent another party may arise through legal representation or authorization.
Article 141 determines the scope of representation based on several grounds, including decisions of competent authorities, the charter of a legal entity, the contents of an authorization document and other applicable legal provisions.
Representatives are also required to inform transaction counterparties of the scope of their representation.
1.1. Can a company have more than one legal representative?
Under Article 12 of the Law on Enterprises, a limited liability company (LLC) or joint-stock company (JSC) may have one or more legal representatives.
The company’s charter must specify the number, managerial titles, rights and obligations of its legal representatives.
Where a company has multiple legal representatives, the distribution of their responsibilities should be clearly established in its charter.
If those responsibilities are not clearly divided, Article 12 provides rules concerning their authority before third parties and their liability. Therefore, businesses should not automatically assume that all legal representatives have identical restrictions or that each representative’s authority is limited without examining the applicable legal framework.
2. Legal Representatives and Authorized Signatories: Key Differences
When reviewing contract signing authority in Vietnam, businesses must distinguish between legal representatives and individuals acting under authorization.
2.1. Legal representatives
A legal representative is an individual authorized by law to represent a company in exercising rights and obligations arising from its business transactions.
When reviewing a contract, the counterparty should verify the company’s current registration information, charter and relevant management documents.
For example, a company may appoint two legal representatives, with one responsible for commercial operations and the other overseeing financial matters.
The scope of their respective responsibilities should be assessed against the company’s charter and applicable governance arrangements.
Checking only the name of the legal representative on the Enterprise Registration Certificate may not reveal every approval requirement associated with a particular transaction.
2.2. Authorized signatories
Under Article 138 of the Civil Code, individuals and legal entities may authorize another person to enter into or perform transactions on their behalf.
In practice, an authorized signatory may be a branch director, procurement manager or employee assigned to execute certain categories of contracts.
However, their signing authority depends on the scope and validity of the authorization.
A managerial title, business card, internal email or verbal instruction should not automatically be treated as sufficient evidence of unrestricted signing authority.
From a governance perspective, companies should maintain accessible authorization records identifying the relevant transactions, financial limits, authorization period and conditions for further delegation, where applicable.
3. Five Checks for Contract Signing Authority in Vietnam
The following five checks can help businesses evaluate contract signing authority in Vietnam before entering into an agreement.
3.1. Verify the legal status of the company and the signatory
The first step is to establish the identity and legal status of the contracting parties.
The responsible department should confirm the company’s registered name, enterprise identification number, registered address and the identity of the individual signing the agreement.
For companies incorporated in Vietnam, the information should be checked against current enterprise registration records.
Where a foreign company is involved, the verification may require incorporation documents, certificates of registration and other documents relevant under the applicable foreign law.
If a company’s legal representative has recently changed, the documentation should establish when the appointment became effective and whether the person had the relevant authority on the intended signing date.
Businesses should also distinguish individuals who are legally entitled to represent the company from employees who merely handle or submit documents as part of their administrative responsibilities.
3.2. Review the company charter and internal approval requirements
Contract signing authority in Vietnam may be affected by the company’s internal governance arrangements.
Certain transactions, particularly high-value contracts, significant asset transfers or related-party transactions, may require approval from an appropriate corporate body.
Legal teams should therefore examine the company’s charter, internal authorization rules and relevant resolutions or decisions.
The review should establish which person or corporate body has authority to approve the transaction, whether any financial thresholds apply and whether additional signatures or approvals are required.
Companies should also consider whether internal restrictions have been communicated to the relevant third parties and how those restrictions interact with the applicable law on representation.
Not every contract requires approval from the Members’ Council or Board of Directors. The relevant requirements depend on the company’s legal form, the nature of the transaction and the applicable governance provisions.
3.3. Examine the authorization document and its validity
Where a contract is signed under authorization, the authorization document should cover the specific transaction.
The review should confirm that the person granting the authorization has the legal capacity and authority to do so.
It should also establish the authorized transaction types, financial limits, effective period, termination conditions and any applicable rules on further delegation.
Practical example
Assume a procurement manager is authorized to sign raw-material supply contracts with a maximum value of VND 1 billion.
The company subsequently intends to enter into a contract worth VND 1.4 billion.
In this situation, the proposed contract exceeds the manager’s stated authorization limit.
Before signing, the business should consider obtaining additional authorization, securing the appropriate corporate approval or arranging for a person with sufficient authority to execute the agreement.
The fact that the procurement manager previously signed similar contracts does not automatically increase their authorized financial limit.
This example illustrates why verification of contract signing authority in Vietnam should consider the actual transaction value rather than relying solely on the signatory’s job title or previous practice.
3.4. Assess the legal consequences of unauthorized signing
Articles 142 and 143 of the Civil Code address the consequences of transactions entered into by persons without representative authority or beyond the scope of their representation.
As a general principle, an unauthorized transaction does not automatically establish rights and obligations for the purportedly represented party.
However, the Civil Code recognizes specific circumstances that may affect this outcome.
These include situations where the principal subsequently recognizes the transaction, knows about the transaction without objecting within a reasonable period, or is responsible for circumstances preventing the other party from knowing that the person lacked authority.
Consequently, a contract signed without proper authority is not necessarily invalid in its entirety in every situation.
The legal consequences depend on the facts, the scope of the unauthorized act, the conduct of the parties and the applicable statutory provisions.
For significant transactions, identifying and resolving signing-authority issues before execution is generally more practical than addressing a dispute after contractual performance has begun.
3.5. Maintain records and control subsequent contract amendments
A reliable contract signing process should include a clear document retention procedure.
Businesses should retain the company’s charter effective at the signing date, appointment decisions, authorization documents, relevant corporate approvals, signed contracts and subsequent amendments.
For electronic agreements, the parties should also consider applicable requirements relating to authentication, document integrity and the ability to retrieve the contractual records.
Contract signing authority in Vietnam should also be reviewed when an agreement is subsequently amended.
For example, a contract amendment may increase the total value, extend its duration or introduce obligations that were not contemplated by the original authorization.
Procurement and Finance teams should therefore confirm that the signatory remains authorized to execute the amendment.
An authorization that was valid for the original contract does not necessarily provide unlimited authority for future changes, particularly where the authorization has expired or contains specific limitations.
4. Practical Example: Contract Signing in a Foreign-Invested Enterprise
Consider a hypothetical foreign-invested company operating in Vietnam.
Its legal representative is currently working overseas, while the company needs to execute a local service agreement.
The company intends to authorize its operations manager to sign the contract.
Before proceeding, the business should verify that the legal representative has authority to delegate the relevant signing responsibilities and that the authorization document adequately covers the proposed service agreement.
It should also confirm whether the transaction requires additional approval under the company’s charter or applicable corporate governance rules.
Suppose the authorization merely permits the manager to handle ordinary administrative matters.
Such wording may not clearly establish authority to enter into a long-term service contract with substantial payment obligations.
In that case, the company should clarify or supplement the authorization rather than assuming that the agreement falls within the manager’s existing responsibilities.
The contracting counterparty should also verify the correct legal entity to avoid confusion between the Vietnamese company, its branches and other companies within the same corporate group.
Where a foreign party is involved, additional considerations may arise regarding governing law, contract formalities and the representative authority of that foreign entity.
This example is hypothetical and should not be treated as a legal conclusion concerning any actual transaction.
5. Common Issues and Frequently Asked Questions
Problems relating to contract signing authority in Vietnam often arise when businesses assume that a director or department manager automatically has unlimited authority to execute contracts.
Another common issue is reviewing the existence of an authorization document without examining its scope, financial limit or expiration date.
Failing to identify the corporate approval requirements for high-value or related-party transactions may also expose a business to contractual disputes and internal governance risks.
Can a Vietnamese company have two legal representatives?
Yes. Under Article 12 of the Law on Enterprises, limited liability companies and joint-stock companies may have one or more legal representatives.
The company’s charter and the applicable legal provisions provide the basis for determining their responsibilities and authority.
Must an authorized department manager become a legal representative?
No. A department manager does not necessarily need to become a company’s legal representative to sign agreements on its behalf.
Vietnamese law recognizes authorized representation.
However, the authorized person must act within the lawful scope of the authorization and comply with the applicable requirements for the transaction.
Is a contract automatically invalid if it is signed beyond the scope of authorization?
Not necessarily.
Articles 142 and 143 of the Civil Code provide rules governing unauthorized representation and acts exceeding representative authority, including specific exceptions.
The legal consequences must be evaluated by considering the transaction, any subsequent recognition by the principal, the parties’ conduct and other relevant circumstances.
6. How PHAM CONSULT Can Support Businesses
For companies operating in Vietnam, effective contract management requires coordination between Legal, Finance, Procurement and senior management.
PHAM CONSULT provides corporate legal advisory and compliance support to businesses operating in Vietnam.
Depending on the agreed scope of engagement, support may include reviewing corporate legal documents, legal representative records, authorization arrangements and compliance matters associated with changes to enterprise registration information.
For foreign-invested enterprises with multiple branches or overseas-based representatives, establishing a clear contract signing authority framework may help reduce procedural inconsistencies and improve document management.
Businesses may also benefit from identifying the appropriate approval procedures for different contract categories and financial thresholds.
For additional information, refer to PHAM CONSULT’s related guidance on changing the legal representative of a single-member limited liability company:
Procedures for Changing the Legal Representative of a Single-Member LLC
For advice concerning corporate representation, authorization arrangements or other business compliance matters, visit PHAM CONSULT to discuss your requirements.
Legal References
- Civil Code No. 91/2015/QH13 dated 24 November 2015, particularly Articles 134–143 concerning representation.
- Law on Enterprises No. 59/2020/QH14 dated 17 June 2020, particularly Article 12 concerning legal representatives.
- Law No. 76/2025/QH15 dated 17 June 2025, amending and supplementing certain provisions of the Law on Enterprises, effective from 1 July 2025.
Disclaimer: The information provided in this article and on the PHAM CONSULT website is intended for general informational purposes only. It does not constitute legal, tax, accounting, payroll or other professional advice for any specific situation. Legal requirements and their application may vary depending on the circumstances, available documents and applicable legislation. Please contact PHAM CONSULT for professional guidance tailored to your circumstances before making decisions or taking action based on this information.
