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The End of an Era: A Step-by-Step Guide to Dissolving and Terminating a Business Location’s Operations

If you're unaware of the latest procedures to terminate a business location's operations, then this article is for you!

23 July, 2024

Do you want to know about the latest regulations regarding the procedures for the dissolution and termination of business locations? Join us to explore the specific contents!

1. Procedures for the dissolution of business location operations

Legal basis

The procedure for dissolving business location operations is based on the provisions of the law

The procedure for dissolving business location operations is based on the provisions of the law, including:

Enterprise Law of the National Assembly of the Socialist Republic of Vietnam No. 68/2014/QH13 dated November 26, 2014;

Decree No. 78/2015/ND-CP dated September 14, 2015 of the Government on enterprise registration;

Decree No. 108/2018/ND-CP dated August 23, 2018 of the Government amending and supplementing a number of Articles of Decree No. 78/2015/ND-CP dated September 14, 2015 of the Government on enterprise registration

Business location dissolution dossier

The dossier for the dissolution of business locations is based on the provisions of Article 60, Decree No. 78/2015/ND-CP dated September 14, 2015 of the Government on enterprise registration

The dossier for the dissolution of business locations is based on the provisions of Article 60, Decree No. 78/2015/ND-CP dated September 14, 2015 of the Government on enterprise registration

Article 60. Termination of operation of branches, representative offices, and business locations

“1. When terminating the operation of a branch, representative office, or business location, the enterprise shall send a Notice of termination of operation of the branch, representative office, or business location to the Business Registration Office where the branch, representative office, or business location is located.

For the termination of the operation of a branch or representative office, the Notice must be accompanied by the documents prescribed in Clause 2, Article 206 of the Enterprise Law, including the decision of the enterprise on the termination of the operation of the branch or representative office, which shall comprise the decision of the enterprise owner in case of a private enterprise, of the owner or Chairman of the Members’ Council or Chairman of the company in case of a limited liability company with a single member, of the Members’ Council in case of a limited liability company with two or more members, of the Board of Directors in case of a joint-stock company, and of the partners in case of a partnership enterprise.

2. The Business Registration Office shall receive the notice, check the legality of the dossier, and change the legal status of the branch, representative office, or business location in the National Database on enterprise registration to the status of terminated operation; and shall simultaneously issue a Notice of termination of operation of the branch, representative office, or business location.

3. The branch, representative office, or business location shall have its Certificate of Registration of Operation and Certificate of Business Location Registration revoked if it ceases operation for 01 year without notifying the Business Registration Office and the tax authority. In this case, the Business Registration Office shall notify in writing of the violation and request the enterprise’s legal representative to come to its head office for explanation. After 10 working days from the end of the deadline specified in the notice, if the requested person does not come for explanation, the Business Registration Office shall issue a decision to revoke the Certificate of Registration of Operation of the branch or representative office and the Certificate of Business Location Registration.”

Thus, we can summarize the dossier for the termination of business location operations as follows:

Notice of termination of business location operations;

Certificate of Registration of Operation of the business location;

Application for supplement and update of registration information (in case the business location is directly under the enterprise that is granted the Investment Certificate, Investment Registration Certificate, or other equivalent legal papers);

Certified copy of the Investment Registration Certificate

Certified copy of the Tax Registration Certificate of the branch (in case the business location is directly under the branch that is granted the Investment Certificate, Investment Registration Certificate, or other equivalent legal papers).

Dossier submission procedure

Make sure you understand the dossier submission procedure for the termination of business location operations to do it right!

The dossier submission procedure for the termination of business location operations includes the following steps:

Step 1: The enterprise must send a Notice of termination of business location operations to the Business Registration Office where the business location is located.

Step 2: The enterprise submits a full dossier for the registration of the termination of business location operations of the enterprise online.

Processing time: 3-5 working days from the date of receipt of the valid dossier,

Step 3: Submit the paper dossier and receive the result:

Procedure: The Business Registration Office receives the notice, checks the legality of the dossier, and issues a Notice of termination of business location operations.

Bring the paper dossier to the one-door division of the Business Registration Office and receive the result when notified that the dossier is valid.

2. Notes on the dissolution of business locations

Make sure you understand the notes on the dissolution of business locations to do it right!

For your convenience, you should submit the dossier to the tax authority directly managing the business location to terminate the validity of the tax code issued for the business location and settle all tax debts (if any). If you choose this method, it will be more convenient when the business location is not in the same province or city as the head office of the enterprise.

Customers and partners also need to be clearly informed about the termination of the enterprise’s business location operations, so the enterprise should notify them in advance and remove the signage of the business location.

3. Frequently Asked Questions about the dissolution of business locations

Not everyone understands the procedures for the dissolution and termination of business locations, so there may be some questions

Not everyone understands the procedures for the dissolution and termination of business locations, so there may be some questions as follows:

How long will it take to process the dossier for the termination of a business location?

Answer: The dossier will be processed within 3-5 working days from the date of receipt of the valid dossier.

What documents are needed to terminate a business location?

Answer: The answer to this question has been shared in the section “Business Location Dissolution Dossier” above!

Who can carry out the procedure for submitting the dossier and receiving the result from the Business Registration Office?

Answer: The person who registered the business location or an authorized person (with a power of attorney)

How to submit the dossier for the termination of a business location?

Answer: The answer to this question has been shared in the section “Dossier Submission Procedure” above!

Through this article, we hope that you have understood the content of the latest procedures for the dissolution and termination of business locations. We hope that you will be able to easily prepare the necessary documents and procedures in accordance with the law. Good luck!

Frequently asked questions

There are several steps to properly dissolve and terminate a business location’s operations. First, gather all necessary documentation, including articles of incorporation, bylaws, and minutes of meetings. Next, notify employees, clients, and vendors of the closure. Pay off any debts and liabilities, and settle contracts and leases. Obtain tax clearance from federal, state, and local authorities, and file the appropriate dissolution documents with the government agency responsible for business registrations.

It is important to communicate the closure to all stakeholders in a timely and transparent manner. Schedule individual or group meetings with employees to explain the situation and provide support. Send formal notification letters to clients and vendors, outlining the reasons for the closure, the timeline, and any relevant details. It is also advisable to publish a public announcement or press release to reach a wider audience.

Prioritize paying off debts and liabilities to minimize legal and financial complications. Identify all outstanding debts, including loans, credit lines, and unpaid invoices. Negotiate payment plans or settlements with creditors, and ensure all payments are made on time. Comply with any contractual obligations and terminate leases or service agreements. Consult with an accountant or financial advisor to ensure accurate record-keeping and compliance with tax regulations.

The specific documents required can vary depending on the business structure, jurisdiction, and other factors. However, some common documents include a resolution to dissolve the business, which should be approved by the owners or shareholders, articles of dissolution or a certificate of dissolution filed with the appropriate government agency, and tax clearance certificates from federal, state, and local tax authorities.

Yes, there are alternative options to explore before completely terminating the business. Consider restructuring or reorganizing the business to improve efficiency and reduce costs. Explore options for selling the business or merging with another company. Alternatively, you can also consider transferring ownership to a new owner if there is interest and feasibility.