Vietnam Amends Business Registration Rules
On August 23, 2018, Vietnam issued Decree 108/2018/ND-CP on business registration, which amended the previous Decree 78/2015/ND-CP. Decree 108 has simplified the procedures for business registration and will be in effect from October 10, 2018.
A new clause has been added under Article 4, according to which enterprises do not require to affix their company seals on the following documents:
- Enterprise registration applications;
- Notice of changes in the application contents; and
- Decision, resolutions, and meeting minutes in the dossier.
Under Article 11, a person with the letter of authorization which allows him/her to implement procedures related to registration no longer needs to be notarized.
One-member LLC dossiers
According to the amended Clause 4 under Article 23, if a single member LLC is registering an enterprise, they are not required to provide the charter/articles of association of the owner/parent in their registration dossiers.
Conversions of enterprises
Companies can now register to change the type of enterprise while they register to change their registration contents. However, this will not be applicable in case there is a change in the legal representative.
Under the previous decree, Decree 78, firms were not allowed to set up business locations outside of the provinces or cities in which their headquarters or branches were registered. Under Decree 108, this restriction has been removed. Now, firms can set up in other provinces/cities by just informing the Business Registration Office of the province/city.
Companies are no longer required to submit a hard copy of the application to the Business Registration Office, in case the notifications on the use, change, or cancellation of a sample seal is done online.
According to Decree 108, in the case where companies need to register a reduction in charter capital, they are no longer required to provide the latest financial statement.
In case new members are admitted in a multi-member LLC, registration of the new members will be required only if there is an increase in charter capital.
Founding shareholder information
A joint-stock company needs to inform the Business Registration Office of any changes in the founding shareholder’s information only if the founding shareholder has not fully paid their share capital.
Announcing enterprise registration
The request for disclosing the enterprise registration must be made at the time the registration dossier is submitted. Earlier, the announcement was made after the registration dossier was submitted.
The new amendments under Decree 108 which have simplified business registration procedures will further improve the business and investment climate in Vietnam.
Vietnam Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia and maintains offices in China, Hong Kong, Indonesia, Singapore, Vietnam, India, and Russia.
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