PROVISIONS ON TERMINATION OF BRANCH ACTIVITIES
- Decree 07/2016/ND-CP detailing the Commercial Law on Representative Offices and Branches of foreign traders in Vietnam
When terminating the operation of a branch of a foreign trader, Clients should note the following provisions:
Cases of termination of operation of branch
- At the request of foreign traders.
- When a foreign trader terminates its operation under the laws of the country or territory where such trader establishes or registers its business;
- The term of operation under the license for establishment of a branch expires and the foreign trader does not request an extension;
- Expiry of the operation period under the establishment license to establish a branch without being agreed to renew by the license-issuing agency;
- The establishment license of the branch is revoked;
- The foreign trader and/or its branch no longer satisfy one of the conditions for granting a license to establish a branch.
Cases of revocation of branch establishment license
- Inactive for 1 year and no transactions with the licensing agency.
- Failure to report on the operation of the branch for 2 consecutive years.
- Failure to send a report to the licensing agency within 06 months from the deadline for submitting the report or request in writing.
Procedures for terminating branch operations
a) Dossier for termination of branch operations
- A notice of termination of operation of a branch, made according to the form of the Ministry of Industry and Trade, signed by an authorized representative of the foreign trader, unless the license to establish a branch is revoked according to regulations.
- A copy of the document of the License-Issuing Agency not to renew the License for Establishment of the branch (in the case of “ Expiry of the operation period under the License to establish a branch without being agreed to renew by the License-Issuing Agency”) or a copy of the decision on revocation of the branch establishment license (in the case of the “The license to establish a branch is revoked”);
- List of creditors and outstanding debts, including tax debts and social insurance contributions;
- The current list of employees and their respective benefits;
- Original establishment license of the branch.
b) Implementation process:
- Foreign traders submit dossiers for operation termination of the branch directly or by post or online (if applicable) to the licensing agency.
- Within 03 working days from the date of receipt of the dossier, the License-issuing agency shall examine and request additional documents if the dossier is incomplete or invalid.
- Within 05 working days from the date of receipt of complete and valid dossiers, the licensing agency shall announce on its website the termination of operation of the branch.
Obligations related to the termination of operation of a branch
The foreign trader and the head of a branch that terminates operations are jointly responsible for the truthfulness and accuracy of the application for termination of the branch’s operation.
In addition to carrying out the procedures for terminating operations as prescribed, foreign traders and branches must publicly announce the termination of operation at the head office of the branch and perform other obligations according to regulations when the branch ceases to operate.
Foreign traders whose branches have ceased operations are responsible for performing contracts, paying debts, including tax debts, and settling all legal benefits for employees who have worked at the branch as prescribed by law.
If you still have any questions during the process of terminating branch operations, please contact Businesslicense.vn for the best support.