VI What are the procedures for converting a Limited Liability Company into a Joint Stock Company? Through today’s article, let’s learn about this issue with Pham Consult!
1. Legal regulations on representative offices of enterprises
According to Clause 2, Article 44 of the Enterprise Law 2020, a representative office is a dependent unit of an enterprise, with the task of representing the interests of the enterprise under authorization and protecting those interests.
A representative office does not perform the business functions of the enterprise.
It can be understood that a representative office is not allowed to directly conduct business, and is not allowed to sign economic contracts with partners unless authorized by the head office. The enterprise manages the activities of the representative office, so all activities related to tax declaration and invoice issuance will be managed by the head office of the enterprise.
2. Cases of termination of representative office operations
According to Article 213 of the Enterprise Law 2020, a representative office of an enterprise shall terminate its operations in the following cases:
– In case of termination of a representative office by decision of the enterprise itself. In this case, when an enterprise wants to terminate the operation of a representative office, it must issue a decision to terminate the operation of that representative office. Accordingly, within 10 days from the date of the decision to terminate the operation of the representative office, the enterprise shall send a Notice of termination of the operation of the representative office to the Business Registration Office where the representative office is located.
– In case of the decision to revoke the Certificate of registration of representative office operations by a competent state agency. Cases of revocation of the Certificate of registration of representative office activities are stipulated in Article 77 of Decree 01/2021/ND-CP on business registration as follows:
+ The content declared in the registration dossier for branch and representative office activities is fake;
+ The representative office ceases operation for 01 year without notifying the Business Registration Office and the Tax Authority;
+ According to the decision of the Court, the request of the competent authority as prescribed by law.
3. Documents and procedures for termination of representative office activities
a. Documents
– Notice of termination of representative office activities (form Appendix II-20 of Circular 01/2021/TT-BKHĐT);
– Resolution, decision and copy of meeting minutes of the Board of Members for limited liability companies with two or more members, partnerships, of the Board of Directors for joint stock companies; Resolution, decision of the company owner for a single-member limited liability company on termination of representative office operations;
– Minutes of the meeting of the Board of Members for a limited liability company with two or more members, a partnership, of the Board of Directors for a joint stock company; resolution on termination of branch and representative office operations.
– List of creditors and unpaid debts, including tax debts of the representative office and social insurance debts;
– List of employees and corresponding current benefits of employees;
– Certificate of registration of representative office operations.
– Notice of confirmation of return of seal of the branch or representative office (if any).
– Request for supplementing or updating information on registration of operations as prescribed (in case the branch, representative office, business location is affiliated with an enterprise granted an Investment License, Investment Certificate or documents of equivalent legal value);
– Valid copy of the Investment Certificate and valid copy of the Tax Registration Certificate of the branch (in case the business location under the branch is granted an Investment License, Investment Certificate or other documents of equivalent legal value).
– Confirmation from the Tax Authority (if any).
b. Procedures
Step 1: Procedures for dissolving a representative office with the tax authority
The enterprise sends an official dispatch to the tax authority to request the tax code of the company’s representative office. The attached documents include:
– Notice requesting to terminate the validity of the representative office’s tax code;
– Decision to dissolve the company’s representative office by the owner/Members’ Council/Board of Directors;
– Minutes of the meeting to dissolve the company’s representative office by the Members’ Council/Board of Directors;
– Photocopy of representative office business license
– Authorization document if not a legal representative
After receiving confirmation of no tax debt from the Tax Department where the enterprise is headquartered, the Tax Department shall issue a notice of termination of the representative office’s tax code.
Step 2: Return the representative office’s round seal (if any)
– If the representative office uses a seal issued by the police agency, it is necessary to complete the procedure of returning the seal and the certificate of registration of the representative office’s seal sample to the police agency to be issued a certificate of seal revocation.
– If the representative office uses the seal and notifies the seal sample to the Department of Planning and Investment, it shall be stored at the company.
Step 3: Procedures for dissolving a company’s representative office in 2021 at the business registration office
The enterprise or authorized person shall carry out the procedure for terminating the operation of the branch in the following manner:
– Submit the dossier on dissolving the company’s representative office directly to the Business Registration Office;
– Submit the dossier on dissolving the company’s representative office via postal service;
– Submit the dossier on dissolving the company’s representative office via the electronic information network at the National Business Registration Information Portal (https://dangkykinhdoanh.gov.vn)
Note:
The termination of the operation of a branch or representative office of an enterprise abroad shall be carried out in accordance with the provisions of the law of that country. Within 30 days from the date of official termination of operations of a branch or representative office abroad, the enterprise shall send a written notice of termination of operations of the branch or representative office of the enterprise abroad to the Business Registration Office where the enterprise has its head office. The Business Registration Office shall update the enterprise’s information in the National Database of Business Registration within 03 working days from the date of receipt of the notice.
4. Receive results of dissolution of the enterprise’s representative office
– Within 3 working days from the date of receipt of all documents on dissolution of the enterprise’s representative office, the business registration agency or the investment management agency shall check the validity of the documents on dissolution of the company’s representative office.
– If the documents are valid, a notice of termination of operations of the branch or representative office will be issued and the dissolution of the branch will be announced on the national information portal.
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