Procedure for Temporary Business Suspension in Vietnam

Temporary business suspension is understood as a case where an enterprise temporarily ceases production and business activities for a certain period and must provide written notice of the start date and duration of the suspension to the business registration authority.

1. Regulations on the Duration of Business Suspension

Enterprises that need to temporarily suspend their business must clearly understand the regulations on temporary suspension according to the Law on Enterprises of Vietnam 2020 and Decree 01/2021/ND-CP, specifically:

• The enterprise must provide written notice to the Business Registration Authority at least 03 working days before the date of temporary suspension.
• The duration of each suspension notice must not exceed one year.

Therefore, according to the above regulations, an enterprise can suspend business for multiple consecutive years. Each time it suspends business, it must provide a notice, and the duration of each notice cannot exceed 01 year.

2. Dossier and Procedures for Notifying Temporary Business Suspension for Companies and Enterprises

According to Article 66 of Decree 01/2021/ND-CP, the dossier and procedures for notifying temporary business suspension for companies and enterprises are as follows:

2.1. Dossier Components

– Notice of Temporary Business Suspension (Form Appendix II-19 issued with Circular 01/2021/TT-BKHDT).

– Resolution, decision, and a copy of the meeting minutes of the Members’ Council regarding the temporary business suspension (for two-or-more-member limited liability companies, partnerships).

– Resolution, decision, and a copy of the meeting minutes of the Board of Directors regarding the temporary business suspension (for joint-stock companies).

– Resolution, decision of the company owner regarding the temporary business suspension (for single-member limited liability companies).

– Power of attorney for the person submitting the dossier and receiving the results if they are not the legal representative.

– A valid copy of one of the personal identification documents of the authorized person (if any):

• For Vietnamese citizens: Valid Citizen Identity Card or Vietnamese Passport.
• For foreigners: Valid foreign Passport or equivalent document.

2.2. Method of Submission

The enterprise founder or enterprise, or an authorized person, shall carry out the enterprise registration procedure by the following methods:

• Direct registration at the Business Registration Office.
• Registration via postal service.
• Online registration on the National Public Service Portal for Enterprise Registration.

2.3. Processing Time

Within 03 working days from the date of receiving a valid dossier.

3. Key Notes When Carrying out Business Suspension Procedures

3.1. Exemption from Business License Tax

A business license tax payer who is in operation and submits a written request for temporary suspension of production and business activities for the calendar year (from January 1 to December 31) to the directly managing tax authority or the business registration authority is exempt from the business license tax for the suspension year, provided that:

• The written request for temporary suspension of production and business activities is sent to the tax authority or business registration authority before the prescribed tax payment deadline (January 30 every year), and;
• The business license tax for the year of temporary suspension has not yet been paid.

In case the temporary suspension of production and business activities does not meet the above conditions, the full-year business license tax must be paid.

3.2. Tax Declarations

The enterprise is not required to submit tax declarations during the temporary suspension period.

The enterprise must still submit tax declarations for the quarter preceding the temporary business suspension period approved by the business registration authority.

3.3. Financial Statements

The enterprise must still submit annual financial statements if the suspension does not cover a full calendar or fiscal year.

3.4. Other Notes

In addition to the important notes on reporting and tax, the enterprise must also ensure compliance with the following regulations:

• The signboard must remain displayed.
• All debts to tax authorities must be settled during the temporary suspension period.
• No new contracts or transactions are allowed to be signed during the temporary suspension period.
• All debts and other asset obligations to customers, partners, and employees must be settled (unless otherwise agreed).

4. Services for Notifying Temporary Business Suspension for Companies and Enterprises at VN Law Firm

Our services for notifying temporary business suspension for companies and enterprises at VN Law Firm help clients save a lot of time and effort. With VN Law Firm, you will receive services for notifying temporary business suspension, including:

• Consulting on the process and procedures for notifying temporary business suspension for companies and enterprises.
• Advising clients on preparing the necessary documents.
• Drafting and submitting the dossier for notifying temporary business suspension for companies and enterprises to the Business Registration Office on behalf of the client.
• Monitoring the dossier, supplementing, or correcting it (if necessary) as requested by the officer.
• Performing the procedure to publish enterprise registration information on the Information Portal.
• Handing over the confirmation of business suspension.
• Guiding clients on important post-suspension procedures to be aware of.