Cases of dissolution and dissolution procedures in a partnership company

Dissolution of a business is the procedure by which a partnership carries out the termination of its business activities. A partnership can only be dissolved when it ensures that all debts and other financial obligations are paid and is not in the process of resolving disputes at Court or Arbitration. The relevant manager and the company dissolved due to the revocation of the Certificate of Business Registration will be jointly liable for the company's debts.

The Enterprise Law 2020 and Decree 01/2021/ND-CP stipulate the cases in which a partnership is dissolved and the procedures that must be followed when dissolving an enterprise.

I. Cases of enterprise dissolution:

If a partnership falls into one of the following four cases, it must dissolve the enterprise:

(1) The term of operation stated in the Company Charter ends without a decision to extend;

(2) According to resolutions and decisions of the Board of Members;

(3) The company no longer has the minimum number of members as prescribed by the Law on Enterprises 2020 for a period of 06 consecutive months without completing procedures to convert the type of enterprise;

(4) The Certificate of Business Registration is revoked, except in cases where the Law on Tax Administration provides otherwise.

II. Procedures for dissolving an enterprise:

For cases under (1) (2) (3), perform the following procedures:

Step 1: The partnership must pass a resolution or decision to dissolve the enterprise. The resolution or decision to dissolve the enterprise must include the following main contents: Name and head office address of the company; Reason for dissolution; Time limit and procedures for liquidating contracts and paying debts of the company; Plan for handling obligations arising from labor contracts; Full name and signature of the Chairman of the Board of Members.

Step 2: Within 07 working days from the date of passing the resolution or decision to dissolve, the partnership shall send the Notification File to the Business Registration Office where the company has its head office. The file includes:

+ Notice of business dissolution;

+ Resolutions, decisions and minutes of meetings of the Board of Members;

+ Debt settlement plan (if any).

+ Authorization letter for the applicant (if any); accompanied by a valid copy of one of the authorized person's personal documents.

Step 3: Within 05 working days from the date of payment of all debts of the partnership, the company shall submit the application for dissolution of the enterprise to the Business Registration Office where the company has its head office. Before submitting the application for dissolution of the enterprise, the partnership must carry out the procedures for terminating the operation of the branch, representative office, and business location of the enterprise at the Business Registration Office where the branch, representative office, and business location are located.

Business dissolution registration documents include:

+ Notice of business dissolution;

+ Report on liquidation of corporate assets;

+ List of creditors and paid debts, including payment of all tax debts and debts of social insurance, health insurance, and unemployment insurance for employees after the decision to dissolve the enterprise (if any).

Working period: Within 07 days.

Note: For partnerships using seals issued by the police agency, the company is responsible for returning the seal and the Certificate of Seal Sample Registration to the police agency as prescribed when carrying out dissolution procedures.

The general partner and legal representative of the company are responsible for the truthfulness and accuracy of the enterprise dissolution records.

For case (4):

Step 1: Within 10 days from the date of receipt of the decision to revoke the Certificate of Business Registration or the effective decision of the Court, the partnership must convene a meeting to decide on dissolution.

The resolution, decision on dissolution and a copy of the decision to revoke the Certificate of Business Registration or the Court's decision with legal effect must be sent to the Business Registration Authority, tax authority, employees in the company and must be publicly posted at the company's head office, branches and representative offices.

Note: In cases where the law requires publication in newspapers, the resolution or decision to dissolve the enterprise must be published in at least one printed or electronic newspaper for three consecutive issues.

Step 2: Within 05 working days from the date of payment of all debts of the company, the legal representative of the company shall submit the dossier for enterprise dissolution registration to the Business Registration Office where the company has its head office. The dossier, order and procedures for enterprise dissolution registration shall be implemented according to Step 2 of case (1) (2) (3).