Question: Our company is a Vietnamese company, 100% invested by Singapore Mother Company.
We are planning a closure of this company (liquidation) and would like to receive a legal opinion as well as performance fee and proposal for the service of company liquidation.
Issues on legal opinion
How to close the company at the current status? (not fulfilling the installment of capital)
If cannot, then what may be any foreseen obstacles or complication on our company liquidation?
How to exhaust capital in short period?
How to recover investment capital fund?
How to close representative office in Ha Noi?
We would appreciate your response to this matter as soon as possible.
Answer: We understand that your compnay (hereinafter referred to as “Client”) is now seeking legal advices for closing its subsidiary company in Vietnam (hereinafter referred to as “Company”).
We therefore are grateful to present you our Legal Services Proposal for your review and consideration.
PROCEDURES FOR CLOSING COMPANY IN VIETNAM
Under the Vietnam’s Enterprise Law 2014, the Company in Vietnam will be terminated in some following cases:
(a) The duration of operation stated in the charter of the company expires and there is no decision to extend;
(b) As decided by the enterprise owner in the case of a private enterprise; by all unlimited liability partners in the case of a partnership; by the Members’ Council or the company owner in the case of a limited liability company; by the General Meeting of Shareholders in the case of a shareholding company;
(c) The company does not have the minimum number of members stipulated in this Law for a period of six consecutive months;
(d) The business registration certificate/Investment Certificate is revoked.
In order to close Company in the case as mentioned in the Item (b). above, Client must:
Finalize and pay all the taxable, financial obligations to Vietnamese Government to close the tax code of Company (if any);
Finalize and pay all personal income tax, social insurance and health insurance of all employees and get certificate for finalizing such works;
Liquidate all the employment contract and other contracts such as office leasing contract, the contract with some suppliers (if any);
Settle all outstanding debts (if any);
Within seven working days after being passed, the resolution on dissolution must be sent to the Licensing Authorities, all creditors, persons having related rights, obligations or interests, and employees in the Company and must be publicly posted at the head office and branches of the Company.
The resolution on dissolution must be also published on at least one written or electronic newspaper in three consecutive issues.
The resolution on dissolution must be sent to creditors together with a notice of the settlement of the debt.
Debts of the enterprise shall be discharged in the following order:
(a) Unpaid wages, retrenchment allowances, and social insurance in accordance with law and other benefits of employees pursuant to signed collective labor agreement and employment contracts.
(b) Tax liabilities and other debts.
After discharge of all debts and costs of the dissolution proceeding of the enterprise, the remainder shall belong to the Company.
Within a time-limit of seven working days after all debts of the Company are fully paid, the legal representative of the Company must submit documents relating to the dissolution of the enterprise to the licensing authority.
Within 7 working days after receiving the enterprise’s valid dissolution dossier, the provincial-level licensing authority shall issue a notice of enterprise dissolution and delete the enterprise’s name from the business register unless the tax department or the police department otherwise requests.
