What does an application for the establishment of the limited liability company in Vietnam? What does an application for conversion of a joint stock company into a limited liability company include?
Conversion of a joint stock company into a single-member limited liability company in Vietnam
Based on Article 203 of the 2020 Enterprise Law, the regulations are as follows:
"Article 203. Conversion of a Joint Stock Company into a Single Member Limited Liability Company
1. A joint stock company can be converted into a single member limited liability company by the following methods:
a) One shareholder acquires all corresponding shares of all other shareholders;
b) An organization or individual that is not a shareholder acquires all shares of all shareholders of the company;
c) The company is left with only one shareholder.
2. The transfer or acquisition of investment capital specified in Clause 1 of this Article must be carried out at market value, assessed through asset appraisal methods, discounted cash flow methods, or other methods.
3. Within 15 days from the date the company has only one shareholder, or completes the share transfer as specified in Points a and b, Clause 1 of this Article, the company must submit the conversion dossier to the Business Registration Authority where the enterprise is registered. Within 3 working days from the date of receipt of the conversion dossier, the Business Registration Authority shall issue the Enterprise Registration Certificate and update the legal status of the company on the National Database of Business Registration.
4. The converted company shall automatically inherit all legitimate rights and interests, and be responsible for the debts, including tax debts, labor contracts, and other obligations of the converted company."
Thus, there are 03 methods of converting a joint stock company to a single member limited liability company as specified above.
What does an application for the establishment of the limited liability company in Vietnam? What does an application for conversion of a joint stock company into a single-member limited liability company include?
Conversion of a joint stock company with 02 shareholders into a multiple-member limited liability in Vietnam
Based on Article 204 of the 2020 Enterprise Law, the regulations are as follows:
"Article 204. Conversion of a Joint Stock Company into a multiple-member limited liability
1. A joint stock company can be converted into a multiple-member limited liability by the following methods:
a) Conversion without further capital raising or share transfer to other organizations, individuals;
b) Conversion while raising capital from other organizations, individuals;
c) Conversion while transferring all or part of the shares to other organizations, individuals;
d) The company is left with only 02 shareholders;
đ) Combining the methods specified in Points a, b, and c of this Clause and other methods.
2. The company must register the conversion with the Business Registration Authority within 10 days from the date of completion of the conversion. Within 3 working days from the date of receipt of the conversion dossier, the Business Registration Authority shall issue the Enterprise Registration Certificate and update the legal status of the company on the National Database of Business Registration.
3. The converted company shall automatically inherit all legitimate rights and interests, and be responsible for the debts, including tax debts, labor contracts, and other obligations of the converted company."
Thus, there are 5 methods to convert a joint stock company to a multiple-member limited liability. If a joint stock company has only 02 shareholders left, it can convert into a limited liability company.
Vietnam: What does an application for conversion of a joint stock company into a single-member limited liability company include?
Based on Clause 4, Article 26 of Decree 01/2021/ND-CP, the regulations are as follows:
"Article 26. Dossier of Enterprise Registration for Cases of Business Type Conversion
…
4. In case of conversion from a limited liability company to a joint stock company and vice versa, the conversion registration dossier includes the documents specified in Articles 23 and 24 of this Decree, which do not include the Investment Registration Certificate specified at Point c, Clause 4, Article 23, and Point c, Clause 3, Article 24 of this Decree. Accompanying the dossier must be the following documents:
a) Resolution, decision of the company owner for a single member limited liability company or resolution, decision and a copy of the minutes of the Members' Council meeting for a multiple-member limited liability or more or resolution and a copy of the minutes of the General Meeting of Shareholders for the joint stock company on the company conversion;
b) Transfer contract or documents proving the completion of the share, capital contribution transfer in case of transfer; Gift contract in case of share, capital contribution gift; A copy of the document confirming the legal inheritance rights of the heir in case of inheritance as prescribed by law;
c) Documents confirming the capital contribution of new members, shareholders;
d) A document from the Investment Registration Authority approving the capital contribution, share purchase, capital contribution purchase by foreign investors, foreign-invested economic organizations in case the registration procedures for capital contribution, share purchase, capital contribution purchase as prescribed by the Law on Investment must be performed."
Thus, when converting a business type from a joint stock company to a limited liability company, the conversion dossier must be prepared as per the regulations above.
What is the current application form for establishment of the limited liability company in Vietnam?
Based on the Appendix issued with Circular 01/2021/TT-BKHDT providing guidance on the application form for establishing a limited liability company as follows:
Download the application form for establishing a single member limited liability company: Here.
Download the application form for establishing a multiple-member limited liability or more: Here.
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