Regulations on leasing private enterprises under Vietnamese Law

Accordingly, a sole proprietorship is a type of property. Therefore, during the operation, it is possible to conduct rental activities. So, what are the regulations on leasing private enterprises under Vietnamese Law? Let’s find out with LSX!

Legal ground

• 2020 Enterprises Law

What is leasing private enterprises?

Basically, the lease of a business is the transfer of the right to own; and use the whole business to another person for a certain period of time to collect a certain amount of money called rent. In fact, the lease of business is a basic right that the law gives to owners of private enterprises. Whether or not the subject leases, chooses who to lease and how to limit the scope of interests and liability for the operation of the business is entirely up to the agreement on the basis of the owner’s self-determination. In addition, the fact that the entity leases the business does not change the owner of the business. Therefore, the business owner is still responsible before the law for the operation of the business as the owner.

In order to ensure the legitimate interests of the parties, the law encourages agreement and has detailed in the business lease contract about the specific responsibilities and interests of owners and tenants for the business results of the Private Enterprise. The issuance of this regulation has become the basis; so that when there is a liability issue with a third party for the operation of the business; the business owner must comply with the unlimited liability regime, but then the tenant compensates or bears the risk if agreed in the contract.

Conditions for leasing private enterprises

Hence the provisions of law, the owner of a private enterprise has the right to lease his private enterprise to another individual; but must fully satisfy the following conditions:

• The owner of a private business will have to make a rental contract. However, when submitting the application for registration with the business registration office; the enterprise must submit a certified copy of the contract.
• The owner of a private enterprise will have to notify in writing the business registration agency or tax agency within 03 working days from the effective date of the contract.
• The owner of a private business is still responsible before the law as a private business owner.

Dossier for private enterprises rental notice

Following Decree 01/2021/ND-CP, a dossier for leasing a private enterprise includes:

• Notice of leasing of private enterprises Appendix II – 6 of Circular 02/2019/TT-BKHDT;
• Notarized copy of rental contract.

Procedure for leasing private enterprises

Step 1: Make a business lease contract

Firstly, the two parties make a business lease contract. The form and content of the contract comply with the principles of the Civil Code 2015.

Step 2: Carry out procedures for notifying the lease of private enterprises

Secondly, the applicant shall prepare the dossier for private enterprises’ rental notice. Then, they must submit it at one of the following two places:

• Submit at the One-Stop Department of the Business Registration Office of the Department of Planning and Investment (BUSINESS REGISTRATION Office) of the province/city where the enterprise is headquartered.
• Submit an online application at the National Business Registration Portal (For Hanoi and Ho Chi Minh City, it is mandatory to submit online).

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