Establishment, Business

Registration and Reorganization

 OUTLINE

1. BUSINESS ESTABLISHMENT
2. BUSINESS REGISTRATION
3. BUSINESS REORGANIZATION
1. Establishment
 1.1 Rights
Establish &manage
Organizations or enterprise
Individuals have the
right to establish
And manage
• Except:
enterprises in • State bodies & units of people’s armed forces of
Vietnam Vietnam
• State officials & employees
• Officers, non- commissioned officers, career
servicemen, national defence workers
• Management personnel in enterprise with 100%
State owned capital
• Minors, prisoners
• Persons – capacity for civil acts is restricted or
lost
 1.1 Rights
Organizations or
Individuals have the
right to establish
And manage
enterprises in
Vietnam
• Purchase share of
shareholding companies
• Contribute capital to
LLCs and partnerships
• Except:
• State bodies & units of people’s
armed forces of Vietnam
• Those who may not contribute
capital to enterprise in
accordance with the law on State
officials & employees.
1.2 Prohibited Business Lines
-Debt collection service business (new regulation);
- Narcotic substance business listed in Appendix I;
- Business of chemicals and minerals listed in Appendix II;
- Business of naturally-occurring specimens of species of wild fauna and flora
listed in the Appendix I of the Convention on International Trade in Endangered
Species of Wild Fauna and Flora; naturally-occurring specimens of category-I
endangered, precious and rare forest fauna, flora and fish listed in the Appendix
III in this Law;
- Prostitution business;
- Purchase and sale of humans, human tissues, corpses and bodily parts, fetuses
(regulations on prohibition of purchase and sale of human corpses and fetuses
are added);
- Business activities related to asexual human reproduction;
- Firecracker business.
2. BUSINESS REGISTRATION
2.1 Procedure for business registration
 PROCEDURE FOR REGISTRATION OF BUSINESS (Art 27. )

• Submit all of the business

Founders of
enterprise
registration documents (art. 20,
21,22, 23,)

• Considers the business registration

Business documents
• Issue a business registration certificate
registration within 3 working day (LOE 2005, 10
day)
body • Notify in written for refusing; include
reason and require for modification
• .
Business registration documents (Art. 20,21,22,23,)
Dossier Private Partnership LLC Shareholding
Enterprise Company
Enterprise Registration Application √ √ √ √

Copy of citizen or PIC, passport or valid √ √ √ √

personal identification paper

List of partners/members/ founding √ √ √

shareholder

Investment registration certificate for √ √ √

foreigner

Establishment decision, enterprise √ √

registration certificate, power of
attorney

Enterprise Registration Certificate √ √

For member being organization, Copy √ √

of enterprise registration certificate
shall be consularly legalized
 Owner’s personal information

PRIVATE ENTERPRISE Owner’s

ONE MEMBER LIMITED Company owner’s or the
LIABILITY authorized representative of
company owner’s
TWO OR MORE MEMBERS Members’
LIMITED LIABILITY

SHAREHOLDING Founding shareholders’ or the

authorized representative of
founding shareholders’

PARTNERSHIP Unlimited liability partners’.

 Name of the
enterprise

Address of head office,

Telephone number,
Fax, Email Address
Lines of Business

Initial Investment
2.2 THE CHARTER OF
A COMPANY
Article 25 (LOE 2014)
– Name, address of head office, branch,
representative office
– Lines of business
– Charter capital: increasing and reducing
– Members’ information
– Share of capital contribution and its value
– Rights and obligations of members or
shareholders
– Management and organizational structure
– Legal representative’s information
– Rules, procedures of company, and other
cases.
I.
2.3: Conditions for issuance of business
registration
 Name of Business
Enterprise Line
Law Maker

Fully paid
Valid
registration
Dossier fee
2.4: Names of enterprise
 Must be pronounceable
Type of Enterprise:

Proper name: written in Letters in

Vietnamese alphabet, FJZW numerals
and symbols

Art 38
Art 39. PROHIBITED PRACTICE IN NAMING ENTERPRISE

1. To use names which are identical to, or cause confusion with, the name of
a registered enterprise.
Example:
_Phuc Hung- limited liability company investment consulting
_Phuc Hung- investment consulting company shares =>unapproved
2. To use the name of a State body, a unit of the people’s armed forces, the
name of a political organization, a socio-political organization, an
occupational socio-political organization, a social organization, a socio-
occupational organization as the whole or a part of the proper name of an
enterprise except where such body, unit or organization so approves.
Example “ state treasury” company =>unapproved
3. To use terms which contravene national historical traditions, culture,
ethics and fine customs.
Example: Chu Van An Ltd. =>unapproved
 NAME OF ENTERPRISE WRITTEN IN FOREIGN
LANGUAGE
1.The name of an enterprise written in a foreign language is the name which is
translated from Vietnamese into the corresponding foreign language.
When translated into a foreign language, the proper name of an enterprise
may be retained or the corresponding meaning may be translated into
such foreign language.
2. The name of an enterprise in a foreign language shall be printed or written
in smaller size than that of its Vietnamese name at the premises of the
enterprise or on transaction papers, documents, materials and printed
matters issued by the enterprise.
3. The abbreviated name of an enterprise may be an abbreviation of its
Vietnamese name or its name in a foreign language.
Example
Tập đoàn Kinh Do
Kinh Do corporation
(article 33_ chapter 2_law on enterprise 2005)
3 - Reorganization
Division, separation consolidation and conversion
of enterprises
 DIVISION OF ENTERPRISES
(Art. 192, LOE 2014)
Limited Liability companies or shareholding
companies may divide their shareholders,
members and assets to established two or more
new companies in one of the following:
• Part of capital contributions or shares of
members or shareholders together with the
assets corresponding to the value of the
capital contributions or shares are
transferred to new companies in proportion
to the value of assets transferred to the new
companies
• All capital contributions or shares of LLC
members or shareholders together with
assets corresponding to the value of their
capital contribution or shares are transferred
to the new companies
• Combination of both
 Division of Enterprise

• Divided company shall cease to exist after the

new companies are granted enterprise
registration certificate
• New companies must be jointly liable for
unpaid debt, labor contract and other property
obligations of the divided company or reach
agreement (whom) to perform such obligations
 SEPARATION OF ENTERPRISES
(Art. 193, LOE 2014)
LLC(s) or Shareholding company(ies) may be separated by
transferring part of the assets, rights and obligations of the existing
company to establish one or more new LLCs or Shareholding
company(ies) without terminating the existence of the separated
company
Form of separations:
• Part of Capital Contributions or shares of the members or shareholders together with
asset equivalent to the value to the capital contributions or share are transferred to
the new companies in proportion to the ownership ratios in the separated company ad
equivalent to the value of assets transferred to the new companies

• The Whole Capital Contributions or shares of one or a number of members,

shareholders together with the assets equivalent to the value of the capital
contributions or shares are transfer to the new companies

Shall register for changes in charter capital

Separated companies and separating companies must be jointly liable for unpaid debts,
labor contract, other properties obligations of the separated company, unless otherwise
agree by involve parties
CONSOLIDATION OF ENTERPRISES
(ART. 194, LOE 2014)
Two or more companies may be consolidated into a new
company, at the same time terminating the existence of the
consolidated companies
CONSOLIDATION OF ENTERPRISES
(ART. 194, LOE 2014)
• In case of consolidation whereby the consolidating
company holds a market share of between 30%-50% of the
relevant market, => must notify the competition
management agency before carrying out the consolidation,
unless other wise prescribed by the law on competition
• >50 of relevant market share: PROHIBITED
• Consolidated companies shall cease to exist
• Consolidating company shall enjoy the lawful rights and
interests and must be liable for the unpaid debt, labor
contract and other property obligations of the consolidated
company
Merger of Enterprise Art 195
 Merger of Enterprise
• One or more company (ies) may be merged into another company by
transferring all lawful assets, rights, obligations and interest to the
merging company and at the same time, terminating the existence of
the merged company
• The merging company shall enjoy the lawful rights and interest and
must be liable for unpaid debts, labor contracts and other property
obligations of the merged companies
• In case of merger whereby the merging company holds a market share
of between 30%-50% of the relevant market, => must notify the
competition management agency before carrying out the
consolidation, unless other wise prescribed by the law on competition
• >50 of relevant market share: PROHIBITED
 CONSUMED

MERGING
MERGED
 Conversion of Enterprise
LLCs to Shareholding companies. Art 196

• Neither Mobilizing other organizations and individuals to contribute additional capital

nor selling the capital contributions to other organizations and individual
• Mobilizing other organizations and Individuals to contribute additional capital
• Selling all or part of the capital contributions to one or a number of other organizations
and individual

Shareholding Companies -> LLC1 Art 197

• A shareholder acquires all the shares or Cap Con of all the remaining shareholders
• An organization/individual acquires all the shares of all shareholders

Private Enterprises into LLC Art 199

• Satisfying all the condition provide in Are 28. (REGISTRATION CERTIFICATE)

• Owner of private enterprise must be the company owner in LLC1 or Member in LLC 2 +
• Owner commits liable to all the unpaid debt and making full repayment when they are
due (in writing)
• Owner commit to perform contract which have yet been perform before conversion
• Commit or agree with other capital contributing member to employ existing employee
DISSOLUTION OF ENTERPRISE
 CASE FOR DISSOLUTION

• The operation duration stated in the company's charter expires without any decision
to renew;
• A decision made by the enterprise owner, for private enterprises; by all general
partners, for partnerships; by the Members' Council or the company owner, for
limited liability companies, or by the Shareholders' Meeting, for joint-stock
companies;
• A company no longer has the minimum number of members as provided for by this
Law for six consecutive months;
• The business registration certificate is withdrawn.

An enterprise shall be dissolved only after paying off all its debts and other property
liabilities.

ART 157
 DISSOLUTION PROCEDURE
1. Resolution on dissolution 2. Liquidation of Assets
Enterprise shall pass Depending on
resolution to dissolve enterprise type,
itself according to decision makers will
Art201.1 directly organize
liquidation of assets

3. Notice of dissolution

Within 7 working days after passage of dissolution, notice must

be given to business registration body, creditor, person with
interests in company, employees and the public if required by
laws
 4. Discharge of debts, distribution of remainder

Assets will be distribute in the following order: 1. unpaid wages,

retrenchment allowance, social insurance and other employees
benefits pursuant to law and contract. 2 Tax, liability and other
debts. 3 owners, members and shareholders

5. Submission of document 6. Revocation and end

Within 5 working days
since all the debts are Business
discharged, dissolution registration
document must be certificated revoked
submitted to business - dissolve within
registration body. The 6 month from
name will be removed from revoke day
Business Reg
 Y O U !
H A N K
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