So sánh pháp luật Nhật Bản và Việt Nam về khởi kiện phái sinh

Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 Open Access Full Text Article Review Article University of Economics and Law, VNU-HCM Correspondence Lien Dang Phuoc Hai, University of Economics and Law, VNU-HCM Email: Haildp@uel.edu.vn History  Received: 25/8/2019  Accepted: 10/12/2019  Published: 30/6/2020 Copyright © VNU-HCM Press. This is an open- access article distributed under the terms of the Creative Commons Attribution 4.0 International license. A comparison of Japan and Vietnam legal approaches to derivative suits Lien Dang Phuoc Hai* Use your smartphone to scan this QR code and download this article ABSTRACT Derivative suits are claims brought by a shareholder or a group of shareholders on behalf of the company to redress for wrongdoings of the directors when those in the company's control refuse to assert a claim usually because of a conflict of interest. The derivative suit is not only to seek re- covery of damages by a plaintiff shareholder but also serves as a further threatening tool that can be a possible deterrent to the neglect of duties by directors and other officers of the company. In Vietnam, the derivative suit mechanism was first adopted by Vietnamese corporate law since Decree No. 102/2010/ND-CP (Decree 102) under the term ``Shareholder's right to sue members of the Board of Management and/or Director (General Director)'', rather than ``derivative suit''. The regulatory framework for derivative suits has since been revised and contemplated under the lat- est Law on Enterprises of Vietnam, which was passed by the National Assembly in 2014. Under this scheme, a shareholder or a group of shareholders holding at least one percent (1%) of the total number of ordinary shares in a Joint Stock Company (JSC) for six consecutive months may bring a lawsuit on behalf of the company against the directors who breach their duties. Still, the practica- bility and usability of this derivative suit mechanism seem questionable because of a plethora of defects and shortcomings in the statutory derivative suit along with the lack of interest in litigation on the part of shareholders. This article undertakes the analytical review of the substance of the statutory derivative suit in Vietnam and Japan and from the comparison between the two systems, provides recommendations to improve the Vietnamese legislation. Key words: Derivative suits, shareholder, liability, fiduciary duty, cost INTRODUCTION There are twomain types of actions against a company available to a shareholder: direct suits and derivative suits. A direct suit is an individual claim brought by a shareholder in his own name to see a legal remedy for the harm that occurred directly to himself because of the violation of the directorial accountability by the company’s board of directorsa. On the contrary, a derivative suit is a claim brought by a shareholder or a group of shareholders on behalf of the company to redress for wrongdoings of the directors when those in the company’s control refuse to assert a claim, usu- ally because of a conflict of interest. The shareholder initiating the lawsuit does so as a representative of the company to pursue civil liability from directors due to their misconduct 1. Theoretically, the company is a separate entity, independent from its sharehold- ers. A shareholder thus cannot bring a claim against a wrongful act made to the company by its directors or other officers. In the case of a derivative suit, the right aSome examples of direct claims include the refusal to allow in- spection of books and records, the deprivation of shareholders’ voting rights, the declaration of dividends, etc. to sue in nature belongs to the company rather than its shareholders. However, since the company is un- willing to exercise their rights because of the conflict of interest, shareholders must derivatively assert this right on behalf of the company1. In addition to the function of loss recovery to the company, the derivative suit also serves as a threat- ening tool that can be a possible deterrent to the ne- glect of duties by directors and other officers of the company because the directors and other officers of money, prestige or even their job can be deprived after the triumph of derivative suits brought by the share- holders2,3. In Vietnam, though it is still debatable whether the nature of lawsuits provided in Decree 102 can be con- sidered as derivative suits, Decree 102 is the first legal document which allowed shareholders to sue man- agers who breached the fiduciary duties and harm the interest of the company and to seek the legal rem- edy for the company’s benefit. After its promulga- tion, there were no official derivative suits instituted by shareholders that are recorded. An important milestone for the development of the derivative suit Cite this article : Hai L D P. A comparison of Japan and Vietnam legal approaches to derivative suits. Sci. Tech. Dev. J. - Eco. Law Manag.; 4(2):745-753. 745 DOI : 10.32508/stdjelm.v4i2.626 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 in Vietnam was the effectiveness of the 2014 Enter- prise Law that introduced the reform for the statutory derivative suit in the hope that the shareholder deriva- tive suits will likely serve as an important tool for pro- moting corporate governance in Vietnam. Subject to the 2014 Enterprise Law, a shareholder or group of shareholders owning at least one percent of the to- tal number of ordinary shares in a JSC for six months are entitled, on behalf of the company, to initiate le- gal action regarding civil liability against members of the Board ofManagement (BOM), the director and/or general director who breach their duties. In doing so, litigation costs shall be borne by the company, ex- cept where the petition initiating legal action by the shareholder is rejected. Despite the improved regu- lation, derivative suits remain unpopular in Vietnam. There is no robust increase in the derivative lawsuit, which can become an incentive for shareholders to commence a lawsuit on behalf of the company to pur- sue the directorial accountability. Japan is probably regarded as a prominent example of transplanting the derivative suit under the pressure of the U.S. after World War IIb. As of the transplan- tation of the derivative mechanism into the Japanese corporate legal regime, this mechanism was mori- bund for more than forty years. The aggregate num- ber of shareholders’ derivative suit between 1950 and 1993was only thirty-three 2. There was a consensus of some scholars that the reason for Japanese sharehold- ers had chosen not to use derivative suits, not because of cultural mores, but mainly because of high filing fees 4. The scenario of the derivative suit in Japan had changed in the early 1990s. The financial crisis in the mid of 1980s had partially paved the way for the up- surge of derivative litigation in Japan. Most impor- tantly, the reduction of the filing fee in the derivative suit explainedmuch of the robust use of the derivative suit in 1993c. Interestingly, in the wake of this legal reform, the number of derivative suits skyrocketed. More specifically, in Japan, while there had been only 84 suits pending in 1993, there were 286 by the end bMathias Siems. Convergence in Shareholder Law. New York: Cambridge University Press; 2008; p.317. cDuring the economic bubble, equity finance which diluted the share of existing shareholders was used by companies. Since the bub- ble burst, many companies were thus left with massive debts. There- fore, shareholders had good reason to pursue the directorial account- ability. Hiroshi Oda. Japanese Law. 3rd ed. Oxford: Oxford Univer- sity Press; 2009; p.253-256. West, in his research, also believed that the burst of the “bubble economy” in the early 1990smay also account for some of the increase of derivative suits. Specifically, he argued that lower the cost of suing makes it easier to pursue the derivative suit of shareholders. The post-Bubble decline in the Japanese economy may also influence some cases, as plaintiffs may find it easier to prove damages against flailing firms. West, Mark D.Why shareholders Sue: Evidence from Japan. Journal Legal Studies 2001; 30:351-382. of 1999. Among other cases, Daiwa case was proba- bly one of the highest amounts of damages acknowl- edge by the court before 2008 where the Osaka Dis- trict Court, in a voluminous decision, ordered eleven current and former directors of Daiwa Bank to pay a total of 775 million US dollars’ worth of damages2,5. THE COMPARISON STUDYOF STRUCTURE OF THE DERIVATIVE SUIT IN JAPAN AND VIETNAM Quorum Requirements Japan is a notable exception case where shareholders can initiate the derivative suit without any require- ments with regard to holding a minimum percentage of shares6. Subject to the Company Act, the share- holder requirement to initiate a derivative suit is to hold the shares (more than one share) for at least 6 consecutive months prior to making a demand to the company to initiate an action to pursue the liability of directors and other officers. If the company refuses to commence a lawsuit or it fails to file such lawsuit within sixty days from the day of the demand, the shareholder who has made such demand may file a lawsuit on behalf of the company (Article 847). In ad- dition, contemporaneous ownershipd is not a condi- tion for derivative suits. In other words, it is unneces- sary for a shareholder to have its shares at the time of the alleged wrongful act of a director. However, if the shareholder ceases to be a shareholder during the derivative suit, the lawsuit will be dismissed un- less the shareholder fulfils one of the exceptional con- ditions under which he or she has lost the status of shareholder such as in a merger (Article 851). In Japan, it is popular for shareholders to take advan- tage of their shares to disrupt the company’s operation for a variety of purposes (such as lowering the stock price or seeking a pay-out) by sokaiya in the man- ner of a settlement with the corporation or director sued in Japan7. A sokaiya is usually a nominal share- holder who either attempts to extort money from a company’s managers by threatening to disrupt its an- nual shareholders’ meeting with embarrassing or hos- tile questions or who works for a company’s manage- ment to suppress dissent at the meeting5. The sokaiya often has a close relationship with yakuza (Japanese dIn most jurisdiction in the United States, the contemporaneous ownership requirement in a derivative require that a plaintiff must have been a shareholder at the time of the misconduct infringing the company’s interest occur andmust remain a shareholder pending the outcome of the litigation. See Seth Aronson, Sharon L. Tomkins, Ted Hassi & Tristan Sorah-Reyes. Shareholder Derivative suits: From Cradle to Grave, in Lyle Roberts, David Siegel, Jerome F. Birn Jr., Jonathan K. Youngwood. Securities Litigation & Enforcement Insti- tute; 2009. 746 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 mafia). In the history of derivative suits, the sokaiya commenced a tremendous number of derivative suits in Japan8. For this reason, the right to demand the company to commence a lawsuit is not available to shareholders who seek unlawful gains for themselves or a third party or seek to inflict damage on the com- pany under that lawsuit (Article 847 para. 1 of the 2005 Company Act). The prevailing statutory scheme in Vietnam also lim- its the rights of shareholders to bring derivative suits against the company. Comparatively, a prerequisite to a shareholder or a group of shareholders initiat- ing a derivative suit against the member of the BOM or the director or general director is to own at least one percent (1%) of the number of ordinary shares in the JSC for six consecutive months. The prerequi- site to the shareholder eligible for the derivative suit still keeps unchanged from Decree 102 to the 2014 Enterprise Law. Notably, there is no regulation re- quiring a shareholder to have its shares at the time of the alleged wrongful act of directors, provided that the shareholder has held such share for a period at least six consecutive months prior to the making of such demand upon the company. Therefore, to some extent, Vietnamese law imposes stricter requirements for shareholders to launch derivative lawsuits than in Japanese law. Who Can Be Sued? In Japan, as directors of a stock company owe a fidu- ciary duty to the company and shareholders, when a director breaches his duty set forth by the law, he is liable vis-à-vis the company for damages and it is pre- rogative of the company to sue the director for resul- tant damages9e.The right to pursue the liability of di- rectors of the company is also a ground for exercising a shareholder derivative suit. Regarding exemption of liability, if directors can demonstrate that they did not fail to exercise their duty of care in the performance of their duties, they will not be held individually liable. Although the Japanese law does provide the derivative suit to assist in supervising the responsibilities and duties of the corporation’s board and officers whether the classical or committee structured company10, the eSubject to Article 423 of the 2005 Company Act, if a director, ac- counting advisor, company auditor, executive officer or accounting auditor (“Officers, Etc.”) neglects his/her duties, he shall be liable to such stock company for damages arising as a result thereof. More- over, the liability of directors also mentions in other provision of the 2005 Company Act, for example, offering illegal profits regarding the exercise of the shareholder’s right is contemplated forth in Article 120 of the 2005 Company Act or illegal distributions of surplus dividends or repurchase of shares that exceed the distributable amount under the 2005 Companies Act at the time of that distribution or repurchase of shares set forth in Article 212 of the 2005 Company Act. derivative suit can be initiated by shareholders on be- half of the company against not only directors but also accounting adviser, corporate auditors, senior exec- utive, accountants, founders, directors and corporate auditors in the established procedures and liquidators (Article 857 of the 2005 Company Law). Comparing with the former provisions where the derivative suit was available only against directors, the 2005 Com- pany Law expanded the scope of people whose liabil- ity can be pursued by a derivative suit. However, if the action is intended for the unjust benefit of the plain- tiff shareholder, or a third party, or to cause damage to the company, this law does not apply. From the Vietnamese perspective, though a deriva- tive suit can be brought against not only president of the BOM, director, legal representative but also other managers who commit violations against the man- ager’s duties provided by the law in a limited liability company (Article 72 of the 2014 Enterprise Law), the persons who can be sued for civil liabilities in the JSC are only the members of the BOM and/or the director (general director). This is a more limited approach than that found in Japan. As such, shareholders are not entitled to file a lawsuit against other managers such as accounting advisers, corporate auditors, se- nior executives, accountants as provided in Japanese law. To pursue a derivative lawsuit against the directors and members of the BOM, the infringement of their duty is a prerequisite. Vietnamese law provides spe- cific circumstances in which the derivative suit can be triggered by shareholders against the directors and members of the BOM for civil liabilities, including (i) failing to perform given rights and obligations hon- estly and prudently to the best of his/her ability and in the best interests of the company and shareholders (ii) failing to implement or to completely implement Res- olutions of the BOM; or Resolutions of the General Meeting of Shareholders; (iii) perform given rights and obligations against the law, the company’s char- ter, or Resolutions of the General Meeting of Share- holders; (iv) uses information, secrets, business op- portunities of the company for self-seeking purposes or serving the interest of other entities; (v) abuses the position, power, or assets of the company for self- seeking purposes or serving the interest of other en- tities; and (vi) other cases prescribed by law and the company’s charterf. In light of the indicated circum- stances, it could be said that Article 161 of the 2014 fIn Vietnam, as opposed to defining the duty of care, the law pro- vides that themembers of the BOM and the director have the respon- sibilities to exercise his powers and duties honestly and prudently to the best of his ability and in the best interests of the company and shareholders (Article 160 of the 2014 Enterprise Law). It should be 747 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 Enterprise Law which lists the specific circumstances where the derivative suit can be triggered, is an open provision. The lawmakers are ambitious to extend the scope of the derivative suit by way of providing that breaching not only any specific circumstance set forth in Article 161 but also other cases prescribed by law and the company’s charter is also a cause of action for derivative suits. As such, depending on the company’s charter, members of the BOM and directors may also be sued by shareholders in case of his infringement of any obligations, whether recorded in the company’s internal documents such as the charter or the law. In addition, the legal grounds for pursuing a deriva- tive suit have not yet mentioned the damage resulted in the wrongful act of a director or member of the BOM. In other words, provided that any violation of a director and a member of the BOM happens, the shareholder is entitled to sue on behalf of the com- pany, regardless of whether actual damage has arisen from the infringing actions or not. However, in prac- tice, evenwhen the lawdoes not require the damage as an element in derivative suits, the shareholders must prove the wrongful acts of the directors or members of the BOM, which cause damage in the trial 11. The Demand Requirement A theoretical perspective explains that since deriva- tive suits are naturally derived from the rights be- longing to the company, as an entity directly suffers from the misconducting behaviour of directors, it is often permitted to commence a derivative action by the shareholder if the company decides, as its creation, not to start a legal action upon its assessment of the case’s merits or any other reasons. In Japan, prior to bringing a derivative suit, the share- holder must make a demand, in writing or any other method set forth by the law, for the company to file the action for compensation for alleged breaches or damage in its own nameg. If the company refuses to commence such suit within sixty days of the demand, the shareholder who made the demand is entitled to initiate an action on behalf of the company. As such, noted that “prudently” in this case equates to the care and diligence. This is the most sophisticated wording set down for the JSC in con- nection with the care and diligence. See Jeremy Seymour Pearce. Di- rectors’ Powers and Duties in Vietnam [Ph.D thesis]. Bond Univer- sity Faculty of Law; 2009. Moreover, like the duty of care, the duty of loyalty is also understood in the same manner. That is, the mem- bers of the BOM, the (general) director have the responsibilities to act in the best interest of the company and shareholders; do not use information, secrets, business opportunities of the company; do not misuse the position, power, or assets of the company for self-seeking purposes or serving the interest of other entities. Therefore, breach- ing the fiduciary duty is one of the conditions for the shareholders to initiate the derivative lawsuit under the Vietnamese corporate law. gArticle 847 of the 2005 Company Act. even in the case that the company refuses the demand to prevent a strike suit, the shareholder may still bring a derivative suit after the rejection of the company. Given that, the company cannot stop a derivative suit from being bought by the plaintiff shareholder even though it is a lawsuit without merits. Consequently, there may be the case where the company’s reputation is hurt even though the unmeritorious case is rejected after the court’s investigation. For this reason, schol- ars believe that, in the case of Japan, the demand re- quirement is merely procedural3,12. In the case of an emergencywhere there is a likelihood of irrecoverable loss caused to the company, the eligible shareholder may initiate the derivative suit without such request. In Vietnam, there is no statutory requirement to file a demand requesting the BOM or Board of Supervi- sion (BOS) to initiate a lawsuit before the shareholder commences a legal action on behalf of the company. Comparing to other countries, such as Japan and Ko- reanh, under Vietnamese law, provided that there are breaches of director’s duty, the eligible shareholder may file civil lawsuits on behalf of the company re- gardless of the board’s approval. Litigation Costs Since the derivative suit asserts a right on behalf of the company rather than the individual shareholders, any awards or settlements recovered typically go to the company, instead of to an individual shareholder. However, the shareholders will also get a pro rata ben- efit indirectly through the increase of the book value of their stock. Meanwhile, the direct suit’s recovered damages will belong to the individual shareholder who has his legitimate interests infringed upon. Due to this difference, the payment of litigation costs from the derivative suit and the direct suit is charged to different claimants. When requests under a deriva- tive suit brought by shareholders are accepted by the court, the litigation cost shall be borne by the com- pany rather than the claimant shareholder as in the direct suit. In the context of Japan, the reimbursement of litigation costs, including filing fees and lawyer fees by the company is statutorily stipulated in the cor- porate lawi. Previously, the filing fee for the deriva- tive lawsuit was determined by the amount in dispute, which is the amount of damage sought by the plaintiff. Consequently, the filing fee presented a major deter- rent from filing a derivative suit as it was substantial hIn Korea, the RMBCA and the ALI’s Principles of Corporate Governance provided, and a plaintiff shareholder should wait for 30 days. Only if the demand and waiting 30 days for board’s response might cause the company irreparable damage, shareholders can bring a suit without demand on board. iArticle 852 para.1 of the 2005 Company Act. 748 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 if the damages sought were high 7. In 1993, a major change regarding the calculation of the court fee to the derivative lawsuit led to a significant reduction of the filing fee. The Commercial Code was amended to provide in Article 267 para. 4 that the derivative suit was to be deemed an action relating to a claim which is not a claim based on a property right in calculating the value of the subject-matter of the suit. As a result, the value of the subject-matter of the dispute was to be determined as a non-property claim in accordance with Article 4 para. 2 of the Law on the Fee of Civil Lawsuits. Concerning the litigation costs in the derivative ac- tion, Article 852 para. 1 of the 2005 Company Act provides that if a shareholder who has filed a law- suit pursuing the director’s liability prevails with the derivative suit, the shareholdermay demand the com- pany to pay a reasonable amount including the nec- essary costs (excluding court costs paid by the share- holder)j or fee to an attorney or a legal profession corporation with respect to the derivative lawsuit, on the condition that the amount is not exceeding the amount such cost or the amount of such fee. As such, the necessary costs or the lawyer’s fee of the derivative suit shall be borne by the company if the case is suc- cessful and these fees, in general, shall be accepted if reasonable, not exceeding the amount of such cost or the amount of such fee. Despite that, it is quite dif- ficult to determine precisely what constitutes a “rea- sonable amount” in practice due to the lack of cases litigated to final judgment even after the 1993 Com- mercial Code revisions5. Comparatively, in Vietnam, litigation expenses in connection with the derivative lawsuit are mainly composed of the court’s fee (including the advanced court feek and the fees incurred during and after hear- ing of the case e.g. fee for issuance of copies of court judgments and ruling) and the lawyer’s fee. Under the Vietnamese litigation system, there are two kinds of claims including non-property and property. For non-property claims (e.g. claims for the return of properties under others’ management), the court fee, in this instance, is a fixed amountl. For property j In the context of Japan, the defeated party bears the court costs, subject to Article 61 of the Japanese Civil Procedure Code. Therefore, in such a case, the court costs will be exempted from the reimburse- ment of costs by the company to the plaintiff shareholder if the case prevails. kArticle 146.1 of theCivil Procedure Code provides that the plain- tiffs, the defendants who have made counterclaims against the plain- tiffs and the persons with related rights and interests who have made independent claims in civil lawsuitsmust advance first-instance court fees; the persons who have made appeals must advance appellate court fees, except for cases where they are exempted from or do not have to pay court fee advances. lArticle 27 of Resolution No. 326/2016/UBTVQH14. claims (e.g. seeking compensation for the director’s liabilities), the court fee is calculated premised on the amount claimed 13. Unlike Japan, Vietnamese laws deem the court fee in the derivative suit as a prop- erty claim, the plaintiff shareholder shall, therefore, pay a contingent incremental fee, as opposed to a fixed feem. For litigation costs, Article 161.1 of the 2014 Enterprise law provides that the litigation cost shall be borne by the company, except where petition ini- tiating legal action by the shareholder is rejected. In other words, in case of losing the lawsuit, the plaintiff shareholder shall bear the litigation cost regardless of the good faith of his action. Therefore, the plaintiff, in this instance, also takes the risks involved into con- sideration when deciding to file a lawsuit. Moreover, because the prevailing law only provides that the litigation cost shall be borne by the company, but does not clarify what kinds of cost, especially le- gal fee, will be categorized as litigation cost, the Civil Procedure Code, therefore, shall be applied to deter- mine the lawyer’s feen. As such, each party shall pay its own fees for requesting such lawyers, except other- wise agreed upon by the parties (Article 168.3 of the 2015 Civil Procedure Code). In the derivative law- suit context, as the shareholder commences an action against the director for the civil liabilities on behalf of the company, the lawyer’s fee can be assumed as the part of litigation costs which the company must pay in case that the plaintiff shareholder claim accepted by the court. Limitations to Prevent Abuse of the Deriva- tive Suits by Shareholders The purposes of the plaintiff shareholder’s deposition are to secure the recovery of damages caused by the plaintiff shareholder who brought a suit in bad faith and broadly to deter abusive actions14. In Japan, in the case where a plaintiff files an action for pursuing liability, the court may, in response to a petition by the defendant, order such the plaintiff to post reasonable security. Besides, when the defendant intends to file the petition in response, the defendant shall make a prima facie evidence showing that the action for pur- suing liability has been filed in bad faith. As such, mFor this reason, in the research of Quach, she also indicated that subject to this calculation, the potential shareholder plaintiffs will probably hesitate to start a lawsuit mainly due to concerns over costs. See Quach, QuynhThuy. Transplantation of Derivative suits to Viet- nam – Tip-Offs from Absence of Academic Debate. Asian Journal of Comparative Law 2012; 7:1-35. nArticle 161.2 of the 2014 Enterprise Law provides that proce- dures for proceedings are prescribed by corresponding regulations of law on civil proceedings. 749 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 when a case reaches the courtroom, the initially cru- cial decision is the court’s judgment of whether to re- quire a plaintiff to post a bond. Although the bad faith in the derivative suit is not clearly defined under the Commercial Code, the dominant opinion expressed by the TokyoDistrict Court is that “bad faith” includes cases in which the plaintiffs sued with little hope of success, or that would likely be dismissed by defen- dants5,14. From theVietnamese perspective, the law does not re- quire the plaintiff shareholder to post security for the derivative suit. As such, the plaintiff can initiate the lawsuit on behalf of the company without posting se- curity. POSSIBLE SHORTCOMINGS AND RECOMMENDATION FOR IMPROVEMENT The Minimum Shareholding Requirement as a Barrier to Derivative suit As indicated earlier, the Vietnamese approach to the derivative suit is not available for the minor share- holders who directly or indirectly own less than one percent of voting stocks of an issuing organization, except for the case where several shareholders get to- gether to meet the requirement. Although the min- imum shareholding requirements are generally justi- fied as being means by which frivolous lawsuits may be prevented15,o in the context of Vietnam, it has been suggested that the requirement of owning one percent by group or individual is a possible barrier to bring a derivative suit. For instance, a minimum share requirement based on the percentage will make it more difficult for shareholders of the large compa- nies or the companies required the high statutory, that is, credit institutions, insurance companies or listed companies, to start a derivative suit than those in small companiesp. Thus, holding one percent of or- dinary shares of these companies is deemed “far too difficult”. Theoretically, shareholders can aggregate oThe minimum shareholding requirement is widely recognized as locus standi rules for taking a derivative suit in civil law jurisdic- tions. For instance, in Korean, the shareholding threshold for filing a derivative suit was 0.01% in the case of listed companies and 1% in the case of non-listed companies or holding 1% of the statutory capital or shares with a par value of EUR 100,000 in Germany. See the Korean Securities and Exchange Act §191-13(1), Korean Commercial Code §403(1), Article 148 (1) of the German Stock Corporation Act. pThe lawful capital requirement for the commercial bank is 3,000 billion Vietnam dong (Decree No. 10/2011/ND-CP), the range from 300 – 1000 billion for the lawful capital to the insurance com- pany depending on the types of the insurance business (Decree No 73/2016/ND-CP), or 120 billionVietnamdong for the company listed in Ho Chi Minh Stock Exchange (Decree 58/2012/ND-CP). their shares to meet 1% of the shareholding require- ment; however, in reality, the cost of coordination of the shareholders to bring a lawsuit will be a big issue. As such, the lack of derivative suits in Vietnammay be first of all attributed to the 1%minimum shareholding requirement. Therefore, a reduction of the sharehold- ing requirement in listed companies and some spe- cific companies with the high statutory capital such as credit institutions and listed companies shall be first of all taken into considerationq. Keeping inmind that when considering the adoption of aminimum re- quirement, it is appropriate to consider not only the need to sift out frivolous litigation but also to ensure that meritorious suits are not blocked. Pre-trial Procedure: Can theCompanyCom- mence a Lawsuit against the (General) Di- rector or Member of the BOM? Previously, the Decree 102 required the shareholder or a group of shareholders holding at least 1% of ordi- nary shares for six consecutive months to request the BOS to institute a lawsuit over the civil liability of a member of the BOM or the director. If the BOS fails to institute such suit, or the company has no BOS, the shareholder or group of shareholders may directly in- stitute a lawsuit against a member of the BOM or a director (Article 25). Since the effectiveness of De- cree 102 the statutory scheme where the BOS had the power to commence the lawsuit was considered by many commentators a unnecessarily complicated re- quirements to initiate a law suitr. qHowever, the arising issue is that what extend the threshold should be reduced to enable minority shareholders to bring the law- suit, while still preventing frivolous action? In fact, it is too diffi- cult to set an appropriate threshold requirement because any fixed percentage of shareholding requirement seems arbitrary. In the case of China, Zhang believes that any figure is arbitrary, over-inclusive, and under-inclusive. In the case that lawsuits are brought for non- financial considerations, a minimum shareholding requirement is ir- relevant. It is impossible to ascertain to what extent the Chinese shareholding requirement should be reduced; on the other hand, there is the legitimate concern that any reduced threshold figure may be too low. See Zhang, Zhong. The Shareholder Derivative suit and Good Corporate Governance in China: Why the Excitement is actu- ally for nothing. Pacific Basin Law Journal 2011; 28(2). rNguyen, Khanh Ngoc believes that granting the power to re- view and initiate the lawsuit to the BOS made it impossible in prac- tice. Also, Hieu, as the vice leader of the Drafting Committee for the 2014 Enterprise Law, criticized that this mechanism makes the procedure for derivative suit more complicated. See Tân Văn. Kiện lãnh đạo doanh nghiệp, cổ đông “bó tay”. Đầu tư Chứng Khoán. 7 January 2014. Available from luat/kien-lanh-dao-doanh-nghiep-co-dong-bo-tay-84317.html. No- tably, Quach is probably one of the most outstanding commentators who supports this mechanism. From her argument, it could be con- vincing to assume that the mechanism for reviewing the case before the derivative suit is necessary. However, the role of BOS is still vague. Decree 102 does not state any investigation procedures that the BOS needs to conduct upon receiving the shareholders’ request. 750 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 This scenario was changed in the 2014 Enterprise Law in the manner that does not require eligible share- holders to file a demand to the company to pursue ac- tion against managers prior to commencing a deriva- tive suit on behalf of the company. Thus procedures to review the merits of the case filed by the plaintiff shareholder in a derivative suit seem absent. It is much better if the Vietnamese law grants com- panies a chance to review any given cause of action that is available, and might decide to or not to pur- sue action against directors at its own discretion. The rational reason is that the company, as the entity sepa- rated from the shareholders and suffered directly from the damages caused by breaching of the directorial ac- countability, is entitled to learn about such breach and might decide whether to commence litigation for pur- suing civil liabilities upon taking all relevant factors, such as the compensation value, litigation fee, reputa- tion into account. It is reasonable for shareholders to initiate a lawsuit, on behalf of their company, after the company fails to bring such suit. Secondly, compar- ing to Japanese law, Vietnamese law does not require the plaintiff shareholder to notify the company about the lawsuit against a director or amember of the BOM on behalf of the company. For this reason, it is diffi- cult for the company to learn about the derivative law- suits against its director(s) or member(s) of the BOM soon enough to intervene or stop the lawsuit from be- ing brought even though it is a case without merit. In addition, there are some cases where a director or a member of the BOM has breached their duty under the law, but the company and the alleged director or member of the BOM have reached the agreement out of the court already by a compensation. Therefore, the company should have the right to receive the demand of the shareholder and initiate the case first, even if they fail to initiate the lawsuit. Litigation Costs: Lack of Incentive for Shareholders In Vietnam, the court fee in the derivative suit as a property claim calculated based on the percentage of the quantum of the claim, which is determined by the court. If the shareholder loses the case, he must If the BOS merely works as a disinterested organ to challenge the company’s managers on behalf of the company, the law still leaves two unresolved matters including what grounds can the BOS refuse the shareholders’ request to bring the case, and if we assume that the BOS refuses to bring the case because it does not serve the best inter- est of the company, does such a decision of the BOS carry any weight in determining while the shareholders may still bring the case after the BOS’ refusal to sue? See Quach, Quynh Thuy. Transplantation of Derivative suits to Vietnam – Tip-Offs from Absence of Academic Debate. Asian Journal of Comparative Law 2012; 7:1-35. bear the litigation cost and in that instance, it would have cost him an enormous amount. This approach seems to be unreasonable, according to some schol- ars, because it is accepted that the derivative suit does not bring the direct monetary benefit for the plaintiff shareholder themselves13, and the recovered amount accrues to the company as a whole with the plain- tiff shareholder benefiting only small pro rata share of any award. To provide some incentive for sharehold- ers I agree with one suggestion that the law should regard the litigation cost that is the court fee, as a non-property claim, rather than a property claim13 because of two main reasons: First, if it deems to be a property claim, the fee that the plaintiff ultimately bear if he or she loses can be extremely high, as the quantum of the damage in the derivative suit tends to be large. However, if the derivative suit deems to be a non-property claim, then the fee will be set as a nominal flat rate. Second, subject to the Civil Proce- dure Code, those who initiate litigation must pay in advance a portion of court fee. Therefore, the share- holder plaintiff, who filed a lawsuit even on behalf of the company must pay the advance court fee. If the derivative suit is categorized as a non-property claim, the shareholder is only required to pay the ad- vance court fee equal to the court fee. In such a case, the court fee advanced will likely be an insignificant amount (equal to the cost fee for the non-property claim). The hurdle in relation to cost fee borne by shareholders is therefore removed. CONCLUSION The derivative suit mechanism has recently been de- veloped as a powerful weapon in the shareholder’s ar- senal to combat the director’s corporate misconduct in many Asian countries. Japan becoming a leader in the number of derivative suits is concrete evidence for the effectiveness of this mechanism in even non- litigious countries. In some respects, Japan’s experi- ence can shed light on the re-evaluation ofVietnamese prevailing law after its significant reform in the 2014 Enterprise Law. The major considerations should be: first, to require a shareholder to file a demand to the company to initiate the lawsuit prior to filing a law- suit on behalf of the company; second, the quorum re- quirement for the shareholders to initiate the deriva- tive suit being one percent of ordinary shares should not be applied for shareholders in the listed company and other special types of companies prescribed by law; third, the filing fee in the derivative suit should be premised on a non-property claim as it is at the moment to facilitate shareholders to bring an action on behalf of the company to pursue the liability of di- rectors. 751 Science & Technology Development Journal – Economics - Law and Management, 4(2):745-753 ABBREVIATIONS BOM: Board of Management BOS: Board of Supervision Decree 102: Decree 102/2010/ND-CP JSC: Joint Stock Company COMPETING INTERESTS The author declare that they have no conflict of inter- est. 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Available from: https://doi.org/10.2139/ssrn.2641863. 752 Tạp chí Phát triển Khoa học và Công nghệ – Economics-Law andManagement, 4(2):745-753 Open Access Full Text Article Bài Tổng quan Trường Đại học Kinh tế-Luật, Đại học Quốc gia TP.HCM Liên hệ Liên Đăng Phước Hải, Trường Đại học Kinh tế-Luật, Đại học Quốc gia TP.HCM Email: Haildp@uel.edu.vn Lịch sử  Ngày nhận: 25/8/2019  Ngày chấp nhận: 10/12/2019  Ngày đăng: 30/6/2020 DOI : 10.32508/stdjelm.v4i2.626 Bản quyền © ĐHQG Tp.HCM. Đây là bài báo công bố mở được phát hành theo các điều khoản của the Creative Commons Attribution 4.0 International license. So sánh pháp luật Nhật Bản và Việt Nam về khởi kiện phái sinh Liên Đăng Phước Hải* Use your smartphone to scan this QR code and download this article TÓM TẮT Kiện phái sinh là vụ kiện được tiến hành bởi một, hoặc một nhóm cổ đông nhân danh công ty, nhằmmục đích khắc phục những sai phạm từ người quản lý, khi những người này đã từ chối việc khởi kiện do các xung đột về lợi ích. Các vụ kiện phái sinh được tiến hành, không chỉ nhằm khôi phục lại những thiệt hại gây ra bởi những người quản lý trong công ty, mà còn là một biện pháp nhằm răn đe, phòng ngừa những hành vi sai phạm từ họ. Tại Việt Nam, chế định kiện phái sinh được ghi nhận lần đầu trong Nghị định 102/2010/NĐ-CP hướng dẫn thi hành Luật doanh nghiệp 2005 dưới tên gọi ``Quyền khởi kiện thành viên Hội đồng quản trị, Giám đốc (Tổng Giám đốc)''. Sau đó, khung pháp lý về khởi kiện phái sinh được chỉnh sửa và ghi nhận chính thức trong Luật Doanh nghiệp, được Quốc hội thông qua chính thức vào năm 2014. Theo đó, cổ đông hoặc một nhóm cổ đông sở hữu ít nhất 1% cổ phần phổ thông liên tục trong 6 tháng, có quyền nhân danh công ty cổ phần khởi kiện những người quản lý đã vi phạm nghĩa vụ của mình. Mặc dù vậy, tính khả thi và hiệu quả của chế định khởi kiện phái sinh tại Việt Nam dường như vẫn còn nhiều hoài nghi, bởi do những hạn chế trong quy định pháp luật cùng với sự thiếu quan tâm đến của cổ đông về chế định khởi kiện này. Trong bài viết này, tác giả sẽ phân tích những quy định của Việt Nam và Nhật Bản về thủ tục khởi kiện phái sinh. Từ kết quả so sánh, những bình luận cũng như những giải pháp được tác giả đề xuất nhằm nâng cao khả năng thực thi thủ tục khởi kiện phái sinh tại Việt Nam. Từ khoá: Kiện phái sinh, cổ đông, trách nhiệm, nghĩa vụ ủy thác, chi phí Trích dẫn bài báo này: Hải L D P. So sánh pháp luật Nhật Bản và Việt Nam về khởi kiện phái sinh. Sci. Tech. Dev. J. - Eco. LawManag.; 4(2):745-753. 753