PROCEDURES OF DISSOLUTION FOR A FOREIGN INVESTMENT CAPITAL COMPANY

In fact, due to many objective and subjective reasons such as finance, organizational structure, internal problems, and so on, businesses have to stop operating. One of the ways to end the existence of a business is dissolution. The dissolution of a company is a procedure aimed at creating a legal basis for a company to terminate its operation. The company's dissolution problem seems to be quite simple but there are many legal issues to note.  Today, Doanh Tri law firm would like to provide clients the dissolution procedure for a company that has foreign investment capital through the following article.

I. Dissolution conditions of foreign investment capital company

According to Enterprise Law 2014, enterprises are only allowed to carry out the procedure for dissolution of foreign investment capital company (either voluntarily or compulsorily from competent state agencies) when satisfying these conditions:

- The company is only dissolved if the company paid off the debts and other financial obligations. If the enterprises cannot guarantee the debts and property obligations can be paid off, it is not allowed to terminate its operation in the form of the dissolution of the enterprise, it must follow the enterprise bankruptcy procedure.

- It is not in the process of settling a dispute in a court or commercial arbitration.

II. Procedures for dissolution of a foreign investment capital company

Documents include:

- The decision to dissolve the enterprise.

- List of creditors and debt amounts paid, including payment of all tax debts and social insurance premiums.

- List of current laborers and employees ’benefits that have been resolved.

- Certificate of business registration.

- A document of the tax authority certifying that the tax settlement is completed, the enterprise has no tax arrears and has closed its tax identification number;

- Three consecutive news or documents proving that the enterprise has published the newspaper;

- A report of the liquidation of assets of the enterprise;

- The document of the bank where the enterprise opens the account confirming that the enterprise no longer owes the bank and has closed the enterprise's account. If the enterprise has not opened an account at the bank, it must make a written commitment that the enterprise has not opened a bank account.

          Step 1: Publish the dissolution information 

The owner must pass a decision to dissolve the business. The dissolution decision must contain the following details:

• Name, a main address of the business
• Reason for dissolution
• Deadline and procedures for liquidation and debt payment of enterprises, the deadline for debt payment and liquidation of contracts must not exceed 06 months from the date of adoption of dissolution decisions.
• Plans for handling financial obligations arising from labor contracts
• Full name and signature of the employer

          Step 2: Organize asset liquidation.

Foreign investment capital companies must directly organize the liquidation of enterprise assets unless the charter of the company requires the establishment of a separate liquidation organization.

         Step 3: Submit the dissolution decision of the enterprise to relevant agencies and organizations

Within seven working days from the date of adoption, the dissolution decision must be sent to the provincial business registration office, all creditors, persons with related rights, obligations, and interests, employees. The company must operate in the enterprise and must be publicly posted at its head office and branches (if any). At the same time, the decision to dissolve the enterprise must be published at least in a written or electronic newspaper in three consecutive issues.

In cases where an enterprise still has unpaid financial obligations, the decision on the dissolution of the debt settlement plan must be attached to the creditors, persons with related rights and obligations. The notice must contain the name and address of the creditor; the amount of debt, duration, location, and method of payment of such debt; methods and time limits for settling complaints of creditors.

           Step 4: Pay the debts of the business

When paying debts, the business should pay attention when paying in the following order:

+ Salary debts, severance allowances, social insurance as prescribed by law and other benefits of employees under the signed collective labor agreement and labor contract;

+ Tax debt;

+ Other debts.

           Step 5: Submit the dissolution request to the business registration office:

After the payment is made, send the dissolution request to the business registration agency within 5 days from the date of payment. Within 180 days after receiving the dissolution decision without receiving an opinion on the dissolution from the enterprise or objections of the concerned parties, the business registration agency shall update the legal status of the enterprise. businesses on the National Enterprise Registration Database.

Above is the information on the procedure of the dissolution of a foreign investment capital company. For further information and advice on this issue, please contact Doanh Tri law directly by one of the following methods:

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

Email: [email protected]

Doanh Tri Law is willingly pleased to accompany you!

Best regards./.