Necessary and Sufficient Conditions When Contributed Capital Is Intellectual Property

3.1.2. Perfecting regulations on capital contribution timing

As analyzed above, in real business life, capital contribution to a limited liability company is often made before the company is established. The time of capital contribution is an objective requirement. Compliance with these objective requirements is one of the reasons for the success of a business. Therefore, to be successful in business, entrepreneurs cannot contribute capital according to their subjective will but must comply with objective real conditions.

One of the important characteristics of the law is objectivity, so the time of capital contribution is made even before the company is established, which is an objective fact, so the LDN cannot stipulate that the time of capital contribution is made after the company is established. The current LDN regulation, as analyzed, is inappropriate when resolving disputes arising from capital contribution in cases where the company is established or not established and the legal basis for recording the company's accounts and financial statements in the accounting books.

To solve the above problem, the Law on Enterprises needs to change the regulations on the time of capital contribution to regulate the capital contribution relationships of members participating in the capital contribution of the company, which is the legal basis for resolving disputes arising between members contributing capital with each other and between members and third parties in the event that the company is established or not established. This regulation is also the basis for preparing accounting books and financial reports of the company. At the same time, changing the regulations on the time of capital contribution of the current Law on Enterprises eliminates the contradiction between the Law on Enterprises and other legal documents. Thus, the Law on Enterprises can change the regulations on the time of capital contribution in the following direction: Capital contribution is the act of members who have the idea of establishing a company or participating in becoming members of a company by providing services or contributing assets for the purpose of establishing a company or for the operation of the company in a public and transparent manner.

3.1.3. Completing regulations on capital contribution assets

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3.1.3.1. On the concept of capital contribution

Although the concept of intellectual property is a very popular concept, however, current Vietnamese law does not have any document regulating the concept of intellectual property, but there is a concept of intellectual property rights in the Law on Intellectual Property "Intellectual property rights are the rights of organizations and individuals to intellectual property, including copyright and rights related to copyright, industrial property rights and rights to plant varieties" [39, Clause 1, Article 4]. Through the concepts of copyright and rights related to copyright, industrial property rights and rights to plant varieties to understand what intellectual property is. Accordingly, intellectual property is understood to include: literary, artistic and scientific works; performance programs, recordings and broadcasting programs; inventions; industrial designs; trade secrets; trademarks; copyrights, patents, trade secrets, business secrets; geographical indications; trade names; new plant varieties; Semiconductor integrated circuit layout design... The concept of "property includes objects, money, valuable papers and property rights" in the Civil Code as well as intellectual property rights in the IP law is regulated by listing the forms of expression, which is not general, creating inadequacies, specifically:

Firstly , the regulations are enumerative and incomplete, leading to the consequences of disputes over the approval of capital contributors in the issue of contributed assets, as well as arbitrary intervention by management agencies in the company's financial reports, affecting the clarity and transparency of financial reports.

Second , because the regulations are enumerative, it creates instability in the law. Because human creativity is endless, the material wealth created by humans, or their property rights, is increasingly diverse and rich. Thus, the listed property categories will have to change over time, and as a result, the regulations on property must also change.

Third , because it is a list, it leads to inconsistency in the concept of property in different texts, sometimes creating contradictions between texts.

Providing general definitions of assets in general and personal assets in particular is necessary, ensuring scientific nature, contributing to the completion of the unity in the legal system, eliminating contradictions and inconsistencies. Providing general regulations will facilitate capital contributors, avoid possible disputes as well as ensure the stability of the law. Definitions of assets must ensure their basic characteristics.

- Assets are elements that have a physical form (tangible), or no physical form (intangible), can be valued, can be transferred in civil transactions and are useful. Assets include money, valuable papers and property rights...

- Intellectual property is a special type of cultural property, which is property created by human intelligence through thinking and creative activities, which cannot be identified by its own physical characteristics but is valuable because it can generate profits and is often protected by law from unauthorized use. Intellectual property includes: literary, artistic and scientific works; performances, recordings and broadcasting programs; inventions; industrial designs; trade secrets; trademarks; copyrights, patents, trade secrets, business secrets; geographical indications; trade names; new plant varieties; semiconductor integrated circuit layout designs...

3.1.3.2. Necessary and sufficient conditions when contributed capital is intellectual property

As analyzed, the contributed capital assets must be the property owned by the capital contributor. If the assets are jointly owned, they must be agreed upon by the joint owners and are assets circulated in civil transactions. The contributed capital assets must be owned by the capital contributors. This is a prerequisite because the act of contributing capital means exercising the right to dispose of them.

Assets. According to current regulations of the LDS, only the owner has the right to dispose of his/her assets. Failure to stipulate that the contributed assets belong to the capital contributors will not be strictly guaranteed, causing disputes over ownership of the contributed assets of third parties to the company, and thus will lead to disputes over rights and interests arising from the contributed assets such as the right to participate in the management of the company, profits from the company's operations, inheritance and transfer of contributed capital. The dispute will affect the organization of the company, the interests and obligations to pay assets when the company goes bankrupt. Therefore, the LDN needs to clearly stipulate that the owned assets must belong to the capital contributors.

When the contributed property is jointly owned property, the joint owners also have rights, including the right to dispose of the contributed property, so the capital contribution using such jointly owned property must be agreed upon by the joint owners.

The direction of improvement of the Law on Enterprises regarding the necessary and sufficient conditions for capital contribution is to clearly stipulate that capital contribution assets must be owned by the capital contributing members, jointly owned assets used as capital contribution assets must be agreed upon by the co-owners based on the approval of other capital contributing members, and assets in dispute cannot be contributed as capital, except in cases where there has been a decision or judgment with effect from the court or competent authority to resolve the dispute.

3.1.4. Time of transfer of ownership of assets and responsibilities of capital contributors

The current LDN stipulates that the time of transfer of asset ownership is the time of capital contribution to the company. However, capital contribution is often made before the company is established, so the time from the time of capital contribution to the time of transfer of asset ownership is still open in the LDN.

The time of transfer of property ownership is extremely important, as it is evidence confirming that a member has contributed capital to the company.

company, from which they enjoy the rights and benefits arising from the act of capital contribution. However, capital contribution is made when the company is established and it can be done many times, so determining when to issue a certificate of capital contribution to the company is necessary, in order to create a legal basis for affirming that a member has performed the act of capital contribution, as evidence in case of a dispute. Therefore, in order for a member to be granted a certificate of capital contribution, they must have evidence for the capital contribution such as invoices, documents on expenses incurred for the purpose of establishing the company, money deposited into a trust account, or confirmation of capital contribution by other members. Thus, before having an official certificate of capital contribution, the members participating in capital contribution must have confirmation or other evidence, so the certification of capital contribution cannot be done once, before officially having the certificate, the members need to be granted a temporary certificate.

The current regulations on granting capital contribution certificates of the LDN are not consistent with reality. Only when the capital is fully contributed will capital contributors be granted a capital contribution certificate. The person granting the certificate is the legal representative of the company.

LDN needs to change and supplement regulations on granting capital contribution certificates in the following direction:

- The issuance of a certificate is not only done once when contributing capital. Before being granted an official certificate of capital contribution, members are granted a temporary certificate of capital contribution for each capital contribution.

- The official issuance of certificates of capital contributions of members is carried out after the valuation of contributed assets and transfer of ownership of assets.

- Official certificate of capital contribution signed by the company's legal representative. Before being granted this certificate, the following certificates must be issued:

The provisional certificate is the basis for comparing the value of capital contributions and the official certificate replaces all provisional certificates.

3.2. PERFECTING THE LEGAL SYSTEM ON INTELLECTUAL PROPERTY VALUATION

To implement capital contribution in the form of intellectual property, it is necessary to continue to improve the legal system on the valuation of intellectual property in Vietnam. This is not only one of the tasks within the framework of improving the specialized legal system on intellectual property and intellectual property rights, but also a requirement of the economy itself, the business environment and business activities of enterprises [5].

Specific requirements for continuing to improve the legal system on asset valuation are as follows:

- Focus on developing legal documents that directly regulate the economic aspects of intangible assets, including contents on or related to the issue of controlling the value of intangible assets, such as creating, exploiting, maintaining, developing, checking and determining the value of intangible assets. The biggest shortcoming in the current Vietnamese legal system on intangible assets is the lack of synchronous and detailed regulations on the economic aspects of intangible assets, especially regulations on determining the value of intangible assets. Although there are about 15 legal documents related to the valuation of intangible assets, these documents only provide principles on how to account for intangible assets - including some types of intangible assets. For example, principles and methods of accounting for intangible fixed assets, principles of monitoring, recording and accounting for the value of intangible assets, principles of considering the value of some types of intangible assets as a basis for determining the actual value of enterprises in equitization activities, etc.

- Unify and standardize terminology, concepts and principles of identification/determination of intellectual property rights in current legal documents related to valuation of intangible assets and intangible assets in a manner consistent with the corresponding provisions of law on intellectual property rights;

- Focus on the unique characteristics of real estate compared to ordinary intangible assets as a basis for determining the appropriate principles for real estate valuation. With the unique characteristics as analyzed above, real estate valuation is a difficult task, if not done correctly, it will easily cause disputes between the parties. Completing legal regulations on real estate valuation as well as regulations on capital contribution for this asset will contribute to limiting risks and disputes, improving economic and civil relations, promoting socio-economic development;

- Fully and clearly stipulate methods for determining the value of fixed assets in accordance with the methods commonly applied in the world today, in which clarify the objectives, principles, criteria, formulas, processes... for performing fixed asset valuation. With the characteristics of this type of asset, we need to conduct further research and learn from the experiences of other countries to apply appropriate valuation methods for each specific type of fixed assets;

- Develop a set of standards for valuation of intangible assets, including intangible assets in accordance with Vietnam's valuation standards, as a legal basis for activities related to the value of intangible assets (accounting, corporate finance, equitization, joint ventures, investment capital contribution, business, dispute resolution, etc.);

- Strengthen training and professional development in asset valuation, organize exams and issue certificates, ensure training quality, and continuously improve the capacity and qualifications of specialized officers in asset valuation;

- Acquiring and learning from the experiences of countries around the world in valuing intellectual property. The value of intellectual property may differ if different valuation methods are used. Therefore, experience factors and the availability of data to implement a particular method may influence the choice of valuation method. Intellectual property rights (e.g. patents) may be valued higher if the term of sale or license does not coincide with the introduction of a complementary or alternative technology or a technology that is effective.

results in the market. Therefore, it is important to have full knowledge of the trend or industry or technology when conducting the assessment.

3.3. IMPROVING THE LEGAL SYSTEM AND ECONOMIC AND SOCIAL INSTITUTIONS

Completing the legal regulations on intellectual property protection as well as the law on contributing capital to business with intellectual property, and valuing intellectual property is necessary, aiming to create better conditions for Vietnamese enterprises to be proactive in building and exploiting intellectual property effectively, contributing to improving the competitiveness of enterprises in the context of strong international economic integration as today. Eliminate and limit profiteering and dishonest behaviors, while encouraging honest and dedicated entrepreneurs to invest in business. To realize this idea requires effective macro management and control of business activities. To avoid arbitrary intervention by administrative measures by competent authorities, the problem is that along with perfecting the provisions of the Law on Enterprises, it is necessary to simultaneously perfect other laws such as the Civil Code, the Law on Intellectual Property, Labor, Accounting, Tax... so that fairness and equality are maintained, all enterprises of different economic sectors are treated without bias or less favorably in the fields of investment, tax payment, product consumption, access to capital as well as scientific and technical technology and dispute resolution.

Perfecting the legal system is not enough. Today, in developed industrial countries, social and economic institutions are increasingly participating in the management of society in general and economic activities in particular in an effective manner. The effectiveness of these institutions, on the one hand, reduces the administrative bureaucracy and the burden of state budget expenditures. Management agencies only deal with areas that cannot be socialized. On the other hand, when these institutions participate in the management of society and the state, it limits the monopoly and imposition of the management agencies and limits corruption.

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