Hanoi-Vietnam: Fines imposed for violations against the regulations on bankruptcy of enterprises and cooperatives

No.

Type of violation

Violations

Fines

1

Acts of obstructing or causing difficulties in exercising the right to apply

Acts of obstructing or causing difficulties in the exercise of the right to file applications of persons who have the right to file petitions for initiation of bankruptcy procedures for insolvent enterprises or cooperatives

Caution or a fine of between VND 500,000 and VND 1,000,000

2

Violations against the regulations on application obligations

Owners of sole proprietorships, Chairpersons of the Board of Directors of joint-stock companies, chairpersons of the Members' Councils of multi-member limited liability companies, owners of single-member limited liability companies, general partners of partnerships or legal representatives of enterprises, the cooperative fails to file a petition for initiation of bankruptcy procedures when the enterprise or cooperative becomes insolvent

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

3

Violations against the regulations on the obligation to provide documents and evidences

Managing and keeping documents and evidences related to the bankruptcy case without providing fully and promptly or inaccurately providing documents and evidences related to the bankruptcy case within 15 days from the date of receipt of the creditor's request, enterprises, cooperatives, People's Courts, People's Procuracies, asset management officers, enterprises managing and liquidating assets without plausible reasons

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

4

Acts of violation of responsibilities of the applicant requesting the opening of bankruptcy procedures

The applicant requests the opening of bankruptcy procedures due to not being objective, adversely affecting the honor, reputation and business activities of the enterprise or cooperative

A fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed

The applicant commits fraudulent acts in requesting the opening of bankruptcy procedures, adversely affecting the honor, reputation and business activities of the enterprise or cooperative

A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed

5

Violations against the regulations on notification of bankruptcy status

enterprises or cooperatives that become insolvent without public notification after receiving the People's Court's decision to open bankruptcy procedures

A fine of between VND 3,000,000 and VND 5,000,000

6

Violations against the regulations on operation of enterprises and cooperatives when there is a decision to open bankruptcy procedures

Enterprises and cooperatives that after issuing a decision to open bankruptcy procedures without reporting to the Asset Management Officer or the asset management and liquidation enterprise before operating related to borrowing, pledge, mortgage, guarantee, purchase, sale, transfer or lease of assets; sale and conversion of shares; transfer of ownership of assets

A fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed

Enterprises and cooperatives that fail to report to the asset management officer or the asset management and liquidation enterprise before terminating the effective performance of the contract after issuing a decision to initiate bankruptcy procedures

Enterprises and cooperatives after issuing a decision to initiate bankruptcy procedures without reporting to the asset management officer or asset management and liquidation enterprise before paying debts arising after opening bankruptcy procedures; pay salaries to employees in enterprises and cooperatives

Enterprises and cooperatives that conceal, disperse or donate assets after issuing a decision to open bankruptcy procedures

A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed

Enterprises and cooperatives that pay unsecured debts after issuing decisions to open bankruptcy procedures, except for unsecured debts arising after opening bankruptcy procedures and paying salaries to employees in enterprises or cooperatives specified at Point c, Clause 1, Article 49 of the Bankruptcy Law

Enterprises and cooperatives that give up their right to collect debts after issuing a decision to open bankruptcy procedures

After issuing a decision to initiate bankruptcy procedures, the enterprise or cooperative shall convert the unsecured debt into a secured debt or partially secured by the assets of the enterprise or cooperative

7

Violations against the regulations on time limit and obligation to inventory assets

Enterprises and cooperatives that become insolvent without taking inventory of assets and failing to determine the value of such assets within the prescribed time limit

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

Representatives of enterprises, cooperatives and others who do not cooperate in the inventory of assets or deliberately falsify the inventory of assets

A fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed

8

Violations against the regulations on obligations of banks where enterprises and cooperatives are subject to liquidation procedures have accounts

The bank where the enterprise or cooperative has its account from the date the People's Court issues a decision to declare the enterprise or cooperative bankrupt but still pays the debts of such enterprise or cooperative, unless there is a written consent of the People's Court or the civil judgment enforcement agency

A fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed

The bank where the enterprise or cooperative has an account from the date the People's Court issues the decision to declare the enterprise or cooperative bankrupt shall pay the debts of the enterprise or cooperative declared bankrupt and borrow from the bank, unless there is a written consent of the People's Court or the judgment enforcement agency Civil

A fine ranging from VND 30,000,000 to VND 40,000,000 shall be imposed

The bank where the enterprise or cooperative has its account from the date the People's Court issues the decision to initiate bankruptcy procedures but clears its obligations against the contract established before the decision to initiate bankruptcy procedures without the consent of the asset management officer, asset management and liquidation enterprises

9

Violations against the regulations on obligations of employees related to bankruptcy procedures

The employee conceals the assets of the enterprise or cooperative from the date the People's Court decides to open bankruptcy procedures

Caution or a fine of between VND 500,000 and VND 1,000,000

Employees who disperse assets of enterprises or cooperatives from the date the People's Court decides to open bankruptcy procedures

A fine of between VND 3,000,000 and VND 5,000,000

10

Violations against the regulations on participation in creditors' meetings

The applicant for initiation of bankruptcy procedures specified in Article 5 of the Bankruptcy Law, the owner of the insolvent enterprise or cooperative fails to participate in the creditors' meeting or authorizes others to participate in the creditors' meeting without plausible reasons

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

11

Violations against the regulations on supervision of implementation of business recovery plans

Enterprises and cooperatives that fail to send reports on the implementation of business resumption plans to asset management officers and asset management and liquidation enterprises within the prescribed time limit

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

12

Violations against the regulations on asset management and liquidation practice

Modifying, erasing or falsifying the contents of the asset management officer practice certificate, deciding to inscribe their names in the list of asset management officers, the list of asset management and liquidation enterprises

A fine ranging from VND 1,000,000 to VND 3,000,000 shall be imposed

Failing to report to the Department of Justice of the province or centrally-run city where the practice is registered or the request of the competent state agency on the practice of asset management and liquidation as prescribed

Failing to make, manage and use books and forms as prescribed by law

Failing to store or archive records of asset management and liquidation activities in contravention of regulations

Leasing, lending or allowing other individuals and organizations to use their asset management officer practice certificates to practice asset management and liquidation

A fine ranging from VND 3,000,000 to VND 7,000,000 shall be imposed

Renting, borrowing or using another person's asset management officer practice certificate to practice asset management and liquidation

Carrying out asset management and liquidation activities in case of insolvency of persons related to enterprises or cooperatives in accordance with the law on enterprises; when there are grounds to believe that the judge conducts bankruptcy procedures, the civil judgment enforcement agency has a request contrary to the provisions of law, the principles of practicing asset management and liquidation or is inconsistent with the Code of professional ethics of asset management officers

Establishing or participating in the establishment of two or more asset management and liquidation enterprises at the same time

At the same time, both registering to practice asset management and liquidation as an individual and practicing in an asset management and liquidation enterprise

Suggesting or receiving any sum of money or material benefits from a participant in bankruptcy proceedings; abusing the name of the asset management officer or abusing the tasks and powers of the enterprise to obtain profits from individuals and organizations in addition to the expenses of the asset management officer received in accordance with the provisions of law

A fine of between VND 7,000,000 and VND 10,000,000

Abusing their duties and powers to collude with individuals and organizations for self-serving purposes

Disclosing information about cases, affairs or customers that they know in the course of their practice or profession, unless otherwise agreed in writing by customers or otherwise provided for by law

Failing to organize the valuation and liquidation of assets or failing to deposit the proceeds into accounts opened at banks by competent People's Courts or civil judgment enforcement agencies or failing to report to civil judgment enforcement agencies, notify participants in relevant bankruptcy procedures of the assignment to individuals, organize the liquidation of assets according to regulations

Failing to terminate the liquidation of assets and handing over all papers and assets of the bankrupt enterprise or cooperative to the civil judgment enforcement agency for handling and liquidation of assets as prescribed in case after 02 years from the date of receipt of the written request of the enforcer but failing to liquidate the assets

Using fake asset management officer practice certificates

A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed

Forging the asset management officer practice certificate

A fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed

Not being eligible to practice asset management and liquidation but practicing asset management and liquidation in any form

13

Violations against the regulations on operation of asset management and liquidation enterprises

Failing to send a written notice to the provincial/municipal Justice Department the enterprise is headquartered after the branches or representative offices of the asset management and liquidation enterprises are granted operation registration certificates or to the provincial/municipal Justice Department where such branch or representative office is headquartered in case the enterprise establishes a branch or representative office in a province or centrally-run city other than the place where the enterprise is headquartered as prescribed

A fine ranging from VND 3,000,000 to VND 7,000,000 shall be imposed

Do not request the provincial/municipal Justice Department where the enterprises register to practice to adjust the information on registration for asset management and liquidation practice when there is a change in the name, address of the head office, representative office, branch, legal representative, list of asset management officers practicing in the managing enterprise, liquidation of assets according to regulations

Allowing other individuals and organizations to use their names and business registration certificates to practice asset management and liquidation

A fine of between VND 7,000,000 and VND 10,000,000

Practicing collusion with insolvent enterprises or cooperatives or other individuals and organizations to disperse assets or falsify contents related to asset management and liquidation practice activities

A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed

Failing to organize the valuation and liquidation of assets or failing to deposit the proceeds into accounts opened at banks by competent People's Courts or civil judgment enforcement agencies or failing to report to civil judgment enforcement agencies, notify participants in relevant bankruptcy procedures of the assignment to individuals, organize the liquidation of assets according to regulations

Failing to terminate the liquidation of assets and handing over all papers and assets of the bankrupt enterprise or cooperative to the civil judgment enforcement agency for handling and liquidation of assets as prescribed in case after 02 years from the date of receipt of the written request of the enforcer but failing to liquidate the assets