In certain cases, companies will carry out procedures to suspend business. Although companies have the right to suspend their business, they must comply with the provisions of law. There will also be cases where the law does not allow the company to pause. So, companies have to understand how the current law regulates business suspension procedures. Therefore, LSX legal firm introduces this article: “Current regulations on business suspension in Vietnam”
Legal grounds
- Law on Enterprise 2020
- Decree 47/2021/ND-CP
Regulations on business suspension of enterprises
When the business faces many difficulties and many businesses cannot continue to operate, business suspension worth considering if the business does not want to carry out a dissolution procedure. In general, the process of carrying out a business suspension is simpler and easier to follow than a complete shutdown (dissolution).
Dossier for carrying out procedures for business suspension:
The dossier to prepare includes the following documents and papers:
- Notice of business suspension;
- Decision on business suspension of the Board of members, the Board of Directors;
- A valid copy of the meeting minutes of the Members’ Council on the meeting to discuss the decision to suspend business for the enterprise;
- Sole proprietorships do not need the decisions and minutes of the meeting to discuss the business suspension.
Order of carrying out procedures for business suspension:
- The enterprise must send a notice to the business registration office where the enterprise has registered at least 03 days before the business suspension. The content of the notice includes the name, address of the enterprise, duration of the business suspension, and reason for business suspension.
- After receiving the enterprise’s application, the Business Registration Office will process the application within 3 working days to give the result.
Term of business suspension:
The duration of the business suspension shall not exceed one year. Besides, the enterprise can extend the suspension before the suspension period ends. Although the number of renewals is unlimited, it must notify the business registration office.
Regulations on business suspension of business households
According to the law, in case of business suspension for 30 days or more, the business household must notify the business registration office of the district where it has registered its business and the tax agency directly managing it. Similarly, the business suspension period must not exceed 1 year.
Dossier for carrying out procedures for temporary suspension of business household:
- Notice of business suspension of business households;
- Authorization letter for the person to submit the application and receive the result if it is not an individual, group of individuals, or the representative of the household that directly carries the procedures themselves.
Order of carrying out procedures for temporary suspension of business household:
Submit the application at the business registration office managing the household business. Besides, there are 2 ways to apply:
- Firstly, submit the application at the One-Stop Department of the People’s Committee of the district where the business household locates its business; or submit it directly at the Finance – Planning Department.
- Secondly, submit the application through the Public Service Portal of the province/city; where the business household locates its business.
Receipt and processing of dossiers:
- The receiver checks the application and gives the receipt to the applicant.
- In case the application is valid; then the Department of Finance – Planning issues the Certificate of business suspension to business households. In case the dossier is invalid, the Finance – Planning Department must clearly notify the contents to be amended and supplement to the person registering the procedure.
Receive results:
Within 3 working days from the date of application submission. The competent person will handle your request to suspend your business.
Regulations on business suspension
Conditions for suspending business:
To suspend business; Enterprises need to satisfy the following regulations before carrying out procedures for business suspension as follows:
- Enterprises need to draft valid business suspension documents; then send them to the management agency 03 days before the official date of business suspension;
- Tax identification numbers and enterprise identification numbers are not temporarily locked; or there is a document restricting the change of the management agency;
- Before suspending business, enterprises must complete other relevant documents on the national portal on business registration;
- Suspended business of affiliated units (branch, representative office, business location) of the company.
Procedures for business suspension:
Step 1: Prepare documents for business suspension depending on certain types of businesses.
Step 2: Submit 01 set of application to the settlement agency-the Business Registration Office of the Department of Planning and Investment where the company’s head office located.
Then, step 3: Receive and process the application. Accordingly, the competent person will receive the dossier. If the dossiers are missing, you will be asked to add documents and records. In case the application meets the conditions for business suspension as prescribed by law, within 03 working days, the agency will reply with a certificate of business suspension to the company/business household.
Term of business suspension
According to the provisions of law, an enterprise may suspend its business for up to 1 year and must send a notice to the Business Registration Office where the enterprise, branch, representative office, or business location has registered at least 15 days before suspending business.
However, if the enterprise has not yet had the conditions to operate again, the enterprise may extend its suspension. Then, The enterprise sends a business suspension notice (second time) to the Business Registration Office (under the Department of Planning and Investment). Besides, the time limit for the second business suspension is 01 year at most.
Business suspension service of LSX Legal Firm
Business suspension-a necessary solution for businesses when they cannot continue doing business for a specified period of time. Suspending business quickly will help businesses avoid unnecessary costs. Meanwhile, the business suspension process contains complicated procedures so if businesses do it themselves, they will face many risks. Using the business suspension service of LSX will make you feel secure in each stage of implementation.
To make your case more convenient, LSX will perform:
- Legal advice related to new regulations in business suspension;
- Representing in drafting and editing documents;
- We commit the papers to be valid, and legal for use in all cases;
- Represent to submit documents, receive results, and hand them over to customers.
With a team of experienced, reputable, and professional consultants; The firm is always ready to support and work with clients to solve legal difficulties.
Furthermore, using our service, you do not need to do the paperwork yourself, We guarantee to help you prepare documents effectively and legally.
Also, you will not have to waste time preparing the application, submitting application, or receiving results. At those stages, we will help you do it smoothly.
After all, LSX provides the service with the desire that customers can experience it the best way. Additionally, we guarantee the cost to be the most suitable and economical for customers.
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Related questions
During the business suspension period, the enterprise must fully pay the outstanding tax amount. Therefore, it can be understood that a business that owes tax is still allowed to temporarily stop operating and is obliged to pay the tax debt in full.
After fully preparing valid dossiers; the enterprise shall submit a dossier of business suspension to the business registration office of the Department of Planning and Investment; where the enterprise has registered for the issuance of the Enterprise Registration Certificate before.
Notice of business suspension of the company for the second time (by sample);
Minutes of meetings of the Board of members (LLCs with 2 or more members); Minutes of the meeting of the company’s shareholders (joint-stock company);
The decision of the company owner on business suspending (1-member limited liability company);
The decision of the Board of members (LLCs with 2 or more members); Decision of the Administrative Council of the company (Joint-stock company);
Power of attorney or authorization contract for an individual/organization to carry out business suspension procedure
Contact LSX
Finally, hope this article is useful for you to answer the question about “Current regulations on business suspension in Vietnam”. If you need any further information, please contact LSX Law firm: +84846175333 or Email: [email protected]
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