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Business suspension is the legal status of an enterprise that is in the period of business suspension as prescribed in Clause 1, Article 206 of the Law on Enterprises. The date of changing the legal status of “suspended business” is the date the enterprise registers to start suspending its business.

1. Conditions for business suspension

Enterprises are obliged to notify the business registration agency and tax administration agency before suspending business at least 3 working days.

At the time the enterprise registers to suspend its operation, the enterprise is not subject to a tax identification number. Many established enterprises do not do business at their registered headquarters or do not do actual business, leading to incomplete tax declarations. At that time, the Tax Department will close the tax code for these businesses. Therefore, businesses will have to restore the closed tax code to be eligible to carry out the business suspension procedure.

2. Dossier for carrying out procedures for business suspension

▪️ Notice of business suspension (reference form is in Appendix II-19 Circular 01/2021/TT-BKHDT);

▪️ Decision on business suspension (of the owner of a one-member limited liability company, of the Members’ Council of a two-member limited liability company, of the Board of Directors of a joint-stock company…);

▪️ A valid copy of the meeting minutes of the Members’ Council, for limited liability companies with two or more members, of the Board of Directors, for joint-stock companies, of general partners, for limited liability companies. name.

3. Procedures for business suspension

Step 1: Prepare business suspension documents

Step 2: Submit the application for business suspension to the Department of Planning and Investment

Step 3: Receive and appraise the company’s business suspension documents

Step 4: Receive notice of business suspension

Step 5: Officially suspend the company’s business activities

4. Time limit for business suspension as prescribed

Although, suspending business is the right of enterprises, but to ensure a stable business market and limit the long-term and difficult-to-control business suspension, the law stipulates that enterprises are only allowed to temporarily suspend business. business for up to 1 year.

According to the old regulations of Decree 78/2015/ND-CP, the maximum period of business suspension is 2 years. However, the newly issued Decree 01/2021/ND-CP no longer has this provision. Therefore, each time an enterprise is allowed to suspend its business for up to 1 year. However, businesses can suspend business many times in a row (no time limit).

5. Legal consequences of enterprises suspending business without notice

If the business suspends its business without notice to the business registration authority, your business may be administratively sanctioned or its Certificate of Business Registration revoked. Specifically:

Firstly, about administrative sanctions for not announcing business suspension

According to Article 50 of Decree No. 122/2021/ND-CP stipulating the level of sanction for acts of violating other notification obligations as follows:

“first. A fine ranging from VND 10,000,000 to VND 15,000,000 shall be imposed for one of the following acts:

c) Failing to notify or notifying on time to the business registration authority of the time and duration of business suspension or resumption.

2. Remedial measures:

c) Forcible notification of the time and duration of suspension or resumption of business to the business registration office in case of failure to notify, for violations specified at Point c, Clause 1 of this Article.”

Thus, the law provides for sanctions for enterprises that suspend their business but fail to notify the business registration agency. Accordingly, the fine level is from 10,000,000 VND to 15,000,000 VND. In addition, the enterprise must apply the remedial measure, which is forced to notify the business registration agency.

Second, the enterprise may have its Certificate of Business Registration revoked

In case an enterprise suspends its business operations for 1 year without giving notice in accordance with the law, its business registration certificate may be revoked, according to the provisions of Article 212 of the Law on Enterprises 2020 as follows:

“first. The enterprise registration certificate shall be revoked in the following cases:

c) The enterprise stops doing business for 1 year without notifying the business registration authority and the tax office”.

6. Business suspension service at MVA Law Firm

MVA Law Firm is proud to be a law firm with extensive experience in legal fields with a branch system in most provinces and cities across the country, will provide you with services when the business is temporarily suspended. business in the Law on MVA as follows:

Free consultation on business suspension procedures;

Representing clients to participate in legal issues, records, and settlement during business suspension;

On behalf of the client to work with agencies and departments when carrying out procedures, as well as resolving legal conflicts when they occur during the working process;

The cost will be notified in advance and will not incur any additional costs during the process of working with our company;

Above are some shares of the MVA Law on the procedure for suspending the company’s business. If you have any questions, please contact us directly for assistance. We are committed to providing businesses with the best quality and best service.