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PROCEDURES FOR DISSOLVING A COMPANY IN VIETNAM

Currently, a company may have to be dissolved for a variety of reasons. In that case, the company must understand the dissolution procedure to avoid wasting time and effort. As a result, Doanh Tri law firm provides this article in order to learn more about this procedure.

I. Legal basis

- Law on Enterprises No. 59/2020/QH14 dated June 17, 2020;

- Decree No. 01/2020/ND-CP dated January 04, 2021, on enterprises registration.

II. Cases of and conditions for dissolution of enterprises

- An enterprise shall be dissolved in the following cases:

1. The operating period specified in the company's charter expires without an extension decision;

2. The enterprise is dissolved under a resolution or decision of the owner (for sole proprietorships), the Board of Partners (for partnerships), the Board of Members and the owner (for limited liability companies) or the GMS (for joint stock companies);

3. The enterprise fails to maintain the adequate number of members prescribed in this Law for 06 consecutive months without converting into another type of business;

4. The Certificate of Enterprise Registration is revoked, unless otherwise prescribed by the Law on Tax administration.

- An enterprise may only be dissolved after all of its debts and liabilities are fully paid and it is not involved in any dispute at the court or arbitration. Relevant executives and the enterprise mentioned in the 4th case are jointly responsible for the enterprise’s debts.

III. Dissolution procedures

1. Enterprise dissolution in the 1, 2, 3 cases shall be carried out as follows:

Step 1: Within 07 working days from the day on which the resolution or decision on dissolution is ratified according to Clause 1 Article 208 of the Law on Enterprises, the enterprise shall send a notification on dissolution to the Business Registration Office of the province where it is headquartered. The notification must be accompanied by the following documents:

- The resolution or decision and the copy of the minutes of meeting of the Board of Members of the multi-member limited liability company or partnership, or of the General Meeting of Shareholders of the joint-stock company, or the resolution or decision of the owner of the single-member limited liability company on enterprise dissolution;

- The debt payment plan (if any).

Step 2: Within 01 working day from the receipt of notification of enterprise dissolution, the Business Registration Office shall post the documents mentioned in Clause 1 of this Article and notify the enterprise’s legal status on the National Business Registration Portal, change the enterprise's legal status on the National Enterprise Registration Database into “undergoing dissolution”, and send information about enterprise dissolution to the tax authority. The enterprise shall fulfill tax liabilities with tax authorities in accordance with regulations of the Law on tax administration.

Step 3: Within 05 working days from the day on which the enterprise’s debts are fully paid, the enterprise shall submit an application for dissolution to the Business Registration Office of province where it is headquartered. An application for dissolution shall include the documents:

-The notification of the enterprise’s dissolution;

- The report on liquidation of the enterprise’s assets; list of creditors and paid debts, including tax debts, social insurance, health insurance, unemployment insurance of employees after the dissolution decision is issued (if any).

Step 4: Before submitting the application for dissolution, the enterprise must complete procedures for shutdown of its branches/representative offices/business locations with the Business Registration Office of provinces where the branch/representative office/business location is situated.

Step 5: After receiving the application for dissolution, the Business Registration Office shall send information about the dissolved enterprise to the tax authority. Within 02 working days from receipt of information from the Business Registration Office, the tax authority shall give its opinions about the enterprise’s fulfillment of tax liabilities to the Business Registration Office. Within 05 working days from the receipt of the application for dissolution, the Business Registration Office shall change the enterprise’s legal status on the National Enterprise Registration Database into “dissolved” if the tax authority has no objection, and issue a notification of the enterprise’s dissolution.

Step 6: After 180 days from the receipt of the notification of dissolution, enclosed with the resolution or decision on dissolution, if the Business Registration Office does not receive the application for dissolution from the enterprise and receives no written objections from relevant parties, it shall change the enterprise’s legal status on the National Enterprise Registration Database into “dissolved”, send information about the enterprise's dissolution to the tax authority, and issue a notification of enterprise's dissolution within 03 working days from the abovementioned deadline.

Step 7: Within 180 days from the receipt of the notification of dissolution, enclosed with the resolution or decision on dissolution prescribed in Article 208 of the Law on enterprises, if the Business Registration Office does not yet change the enterprise’s legal status on the National Enterprise Registration Database into “dissolved” and the enterprise wishes to cease dissolution procedures, it shall send a notification of invalidation of the dissolution resolution or decision to the Business Registration Office of province where it is headquartered. Such notification must be enclosed with the resolution or decision of the owner of the single-member limited liability company, or of the Board of Members of the multi-member limited liability company or partnership, or of the General Meeting of Shareholders of the joint-stock company, on invalidation of the dissolution resolution or decision. Within 03 working days from the receipt of the notification of invalidation of the dissolution resolution or decision from the enterprise, the Business Registration Office shall post the received notification and the resolution or decision on invalidation of the dissolution resolution or decision on the National Business Registration Portal, restore the enterprise’s legal status on the National Enterprise Registration Information System, and send information about the invalidation of the dissolution resolution or decision to the relevant tax authority.

If an enterprise uses a seal issued by a police authority, the seal and the certificate of seal registration shall be returned to the police authority when following dissolution procedures.

2. Dissolution of enterprise upon revocation of its enterprise registration certificate or under a Court’s decision

Step 1: Within 01 working day from the date of issue of the decision to revoke enterprise registration certificate or from the receipt of the effective court’s decision, the Business Registration Office shall post the decision and notify the enterprise’s “undergoing dissolution” status on the National Business Registration Portal, change the enterprise's legal status on the National Enterprise Registration Database into “undergoing dissolution”, and send information about enterprise dissolution to the tax authority, except the enterprise whose enterprise registration certificate is revoked to serve the implementation of coercive measures at the request of tax authorities.

Step 2: Within 05 working days from the day on which the enterprise’s debts are fully paid, the enterprise’s legal representative shall submit an application for dissolution to the Business Registration Office of province where it is headquartered.

Step 3: After 180 days from the day on which the enterprise’s “undergoing dissolution” status is posted on the National Business Registration Portal, if the Business Registration Office does not receive the application for dissolution from the enterprise and receives no written objections from relevant parties, it shall change the enterprise’s legal status on the National Enterprise Registration Database into “dissolved”, send information about the enterprise's dissolution to the tax authority, and issue a notification of enterprise's dissolution within 03 working days from the abovementioned deadline.

The above information is about the ‘Procedures for dissolving a company in Vietnam.' For more information and advice on this issue, please contact Doanh Tri Law Firm directly via:

Hotline: (+84) 911.233.955 - (024) 6293 8326

Email: contact@luatdoanhtri.vn

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