PROVISIONS ON TERMINATION OF REPRESENTATIVE OFFICE ACTIVITIES

Legal basis:

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 representative office of a foreign trader, clients should note the following provisions:

Cases of termination of operation of representative offices

1. At the request of foreign traders.
2. When a foreign trader terminates its operation under the laws of the country or territory where such trader establishes or registers its business.
3. The term of operation under the license for establishment of a representative office expires and the foreign trader does not request an extension.
4. Expiry of the operation period under the establishment license to establish a representative office without being agreed to renew by the license-issuing agency.
5. The establishment license of the representative office is revoked.
6. The foreign trader and/or its representative office no longer satisfy one of the conditions for granting a license to establish a representative office.

Cases of revocation of representative office establishment license

Inactive for 1 year and no transactions with the licensing agency.

Failure to report on the operation of the Representative Office 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 representative office operations

a) Dossier for termination of representative office operations

• A notice of termination of operation of a representative office, 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 representative office is revoked according to regulations.
• A copy of the document of the License-Issuing Agency not to renew the License for Establishment of the Representative Office (in the case of “ Expiry of the operation period under the License to establish a Representative Office without being agreed to renew by the License-Issuing Agency”) or a copy of the decision on revocation of the representative office establishment license (in the case of the ” The License to establish a representative office 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 representative office.

b) Implementation process:

• Foreign traders submit dossiers for operation termination of representative offices 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 representative office.

Obligations related to the termination of operation of a Representative Office

The foreign trader and the head of a representative office that terminates operations are jointly responsible for the truthfulness and accuracy of the application for termination of the representative office’s operation.

In case a representative office terminates is terminated its operation in a province/city or an area under the management of a management board, to move to another province, city or geographical area under the management of another management board, the termination dossier includes only the following documents:

• A notice of termination of operation of a representative office, 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 representative office is revoked according to regulations. 
• Original license for establishment of representative office.

In addition to carrying out the procedures for terminating operations as prescribed, foreign traders and representative offices must publicly announce the termination of operation at the head office of the representative office and perform other obligations according to regulations when the representative office ceases to operate.

Foreign traders whose representative offices 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 representative office as prescribed by law.

If you still have any questions during the process of terminating representative office operations, please contact businesslicense.vn for the best support.