When the business enterprise goes down, the business owner will choose to suspend the business or dissolve. If a business has a strategy to solve the difficulties, then the business will choose to suspend business. The suspension does not simply mean an enterprise taking the initiative not to resume production and business activities anymore. Businesses have to carry out the business suspension in accordance with the law. The first business suspension period is 1 year, after 1 year the business can suspend for the next time. So, how is the 2nd business suspension procedure different from the 1st time and how is it done? To answer this question, LSX legal firm provides: “Suspending business for the second time quickly in Vietnam”
- Law on Enterprise 2020
- Decree 47/2021/ND-CP
- Decree 78/2015/ND-CP
Suspending business for the second time
Article 57 of Decree 78/2015/ND-CP stipulates business suspension for the second time as follows:
- When an enterprise carries out procedures for business suspension, a notification of suspension of the branch/representative office/business location shall be sent to Business Registration Office where the branch/representative office/business location is registered.
- When an enterprise or branch/representative office/business location suspends its operation or resumes its operation ahead of schedule, a notification shall be sent to the Business Registration Office where the enterprise or its branch/representative office/business location was registered at least 15 days before the date of suspension or resumption. The suspension period must not exceed one year. If the enterprise or its branch/representative office/business location is still suspended after this period, another notification must be sent to Business Registration Office. The total duration of continuous suspension must not exceed two years.
Therefore, after the end of the business suspension period, if the enterprise wants to continue to suspend its business, it must submit a notice of business suspension to the business registration office.
Procedures to suspending business for the second time
According to current law, to suspend business for the second time, businesses have to carry out the following procedures:
Step 1: Prepare dossiers and submit a business suspension application
- Enterprises draft dossiers for their business suspension and then submit to the registration agency to conduct business suspension.
- Next, the Business Registration Office – Department of Planning and Investment will receive the application submitted by the businesses.
Step 2: The Business Registration Office processes the application
- The business Registration Office handles the application. Then, they will verify the form and content of the business suspension application.
- Complete dossier processing and update dossier status on the online database. Businesses can then look up the status of their application.
Step 3: Return the result
- In case the application is valid, the enterprise will submit the hard copy application to the Business Registration Office.
- In case the application invalid and needs amendment or supplementation, the enterprise shall amend and supplement the dossier as required and then resubmit it.
Dossiers to suspending business for the second time
After the above steps, you have a preliminary understanding of the application process and submission process. More specifically, the dossiers needed to prepare for the second business suspension include:
- Notice of business suspension;
- Decision and valid copy of meeting minutes of the Board of Members, for limited liability companies with two or more members; of the company owner for a single-member limited liability company; the Board of Directors for joint-stock companies; of general partners in the case of partnerships;
- For enterprises that granted investment licenses, investment registration certificates, or equivalent legal papers, in addition to the above documents, the enterprises must submit:
- A valid copy of the Investment Certificate;
- A valid copy of the tax registration certificate;
- Application for supplement and update of business registration information.
Notice of business suspension for the 2nd time
After implementing and announcing to suspend of business for the second time. Enterprises need to notify about the continuation of their suspension. This notice means to ensure the business provides information about its current status to the outside. Because the situation of the business will be a concern to investors, customers, suppliers, and many other stakeholders.
The announcement of the suspension is also a condition for enterprises to exempt themselves from making corporate income tax reports and many other annual documents.
Suspend the business of an enterprise
Suspending business gets a way for businesses to have time to improve, change, and complete the apparatus to do business more effectively in the future.
In fact, most business owners do not know that when the company suspends business, they have to notify the Department of Planning and Investment where the company located. This notification is mandatory; If not, they will face the risk of an administrative penalty of up to 2 million VND (According to Article 32 of Decree 50/2016/ND-CP).
Additionally, when the enterprise has actually suspended without notifying the business suspension, it will continue to perform the legal obligations regarding:
- Declare and report tax quarterly and annually for the company.
- The tax authority will still conduct periodic inspections of business establishments.
- Obligation to declare and pay compulsory social insurance for employees even though the company has stopped operating in reality;
- Obligation to pay annual license tax even though no longer doing business.
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.
According to the old regulations, the maximum duration of business suspension is 2 years. However, Decree 01/2021/ND-CP no longer stipulates this provision. Therefore, each time suspending business is up to 1 year. However, businesses can suspend their business many times in a row (no time limit).
In case the subjects are not enterprises: Taxpayers are entitled to suspend their operations of the business for no more than 1 year for 1 registration. In case the taxpayer is an organization, the total period of suspension of business shall not exceed 2 years for 2 consecutive registrations.
Currently, the form of notice of business suspension for enterprises is made according to form II-21 in Circular 01/2021/TT-BKHDT.
Finally, hope this article is useful for you to answer the question about “Suspending business for the second time quickly in Vietnam?”. If you need any further information, please contact LSX Law firm: +84846175333 or Email: email@example.com