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Legal provisions on suspension and termination of enterprises

12/10/2021
In case an enterprise suspends or terminates its operations, it must comply with the legal provisions on suspension and termination of its business operations.

According to Law on Enterprises 2020, the suspension and termination of business operations are regulated as follows:

a) In case an enterprise suspends or terminates its operation:

  • An enterprise shall send a written notification to the business registration authority at least 03 working days before the suspension or resumption date.

  • In case of business suspension, the notification must be enclosed with:

    • 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 Board of Directors of the joint-stock company.

    • Or the resolution or decision of the owner of the single-member limited liability company on business suspension.

  • After receiving the application for enterprise registration, the Business Registration Office shall give a confirmation slip, examine the validity of received documents, and issue a certification that the enterprise or its branch/representative office/business location has registered the business suspension or resumption of business ahead of schedule within 03 working days from the receipt of satisfactory documents.

  • The enterprise may apply for resumption of business ahead of the notified schedule and notify the resumption of business ahead of the notified schedule for its branches/representative offices/business locations at the same time. The Business Registration Office shall update the enterprise’s legal status and status of its branches/representative offices/business locations on the National Enterprise Registration Database at the same time.

  • The Business Registration Office shall change the enterprise’s legal status and status of its branches/representative offices/business locations on the National Enterprise Registration Database to “business suspension”.

b) In case an enterprise suspends or terminates its business activities at request of a competent authority:

  • The business registration authority and competent authorities are entitled to request an enterprise to suspend or terminate its business operation in the following cases:

    • The enterprise does not fully satisfy the conditions for doing business in restricted business lines and must suspend or terminate business operation in the corresponding business lines.

    • Relevant authorities request the suspension in accordance with regulations of law on tax administration, environment and relevant laws.

    • Operation in one or some business lines have to be suspended or terminated under a court decision.

  • If the enterprise fails to comply with the request, the Business Registration Office shall request the enterprise to submit a report according to Article 216(1)(c) of Law on Enterprises 2020.

c) During the suspension period, the enterprise shall fully pay the unpaid taxes, social insurance, health insurance, unemployment insurance premiums and fulfill contracts with its clients and employees, unless otherwise agreed by the enterprise, creditors, clients and employees.

Legal basis

  • Law on Enterprises 2020.

  • Decree 01/2021/ND-CP on Enterprise registration.

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Headoffice in Hanoi:

Address: Floor 12A Sao Mai building, No. 19 Le Van Luong street, Nhan Chinh Ward, Thanh Xuan District, Hanoi.

Hotline: +84 967 818 020

Email: hanoi@siglaw.vn

Ho Chi Minh City Branch:

Address: 21 N4 street, Commercial service and housing complex at No.16/9 Bui Van Ba street, Tan Thuan Dong Ward, District 7, Hochiminh city.

Hotline: +84 985 982 659

Email: hcm@siglaw.vn 


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Siglaw legal company limited
Headoffice in Hanoi:
Address: Floor 12A Sao Mai building, No. 19 Le Van Luong street, Nhan Chinh Ward, Thanh Xuan District, Hanoi.
Hotline: +84 967 818 020
Email: hanoi@siglaw.vn
 
Ho Chi Minh City Branch:
Address: 21 N4 street, Commercial service and housing complex at No.16/9 Bui Van Ba street, Tan Thuan Dong Ward, District 7, Hochiminh city.
Hotline: +84 985 982 659
Email: hcm@siglaw.vn
 
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