How much is the penalty for dishonestly declaring a registration dossier to change the business registration content?
- Are enterprises only allowed to operate in the business lines that they have registered with the business registration authority in Vietnam?
- Vietnam: Is providing dishonest information in the application for changes to enterprise registration information a violation of the law?
- How much is the fine imposed upon an enterprise providing dishonest information in application for changes to enterprise registration information in Vietnam?
Are enterprises only allowed to operate in the business lines that they have registered with the business registration authority in Vietnam?
Pursuant to the provisions of Clause 1, Article 7 of the Law on Enterprise 2020 on the rights of enterprises:
Rights of enterprises
Every enterprise has the right to:
1. Freely engage in any business line that is not banned by law.
2. Freely run the business and choose a type of business organization; choose business lines, area of operation and type of operation; change the scale of business and business lines.
3. Choose the method of mobilizing, distributing and using capital.
4. Freely find markets, customers and enter into contracts.
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Thus, every enterprise has the right to freely engage in any business line that is not banned by law.
Pursuant to Clauses 1 and 2, Article 8 of the Law on Enterprise 2020, enterprises must maintain the fulfillment of conditions for conducting restricted business lines.
Enterprises must apply for enterprise registration; register changes to enterprise registration information; publish information about the establishment and operation of the enterprise; submit reports and fulfill other obligations prescribed by this Law.
In addition, pursuant to Article 56 of Decree 01/2021/ND-CP on the notification of addition/change of business lines:
Notification of addition/change of business lines
1. In case of addition/change of business lines, the enterprise shall send a notification to the Business Registration Office of province where it is headquartered. The application for enterprise registration shall include the following documents:
a) A notification of changes to enterprise registration information which is signed by the enterprise’s legal representative;
b) The resolution or decision and the copy of the minutes of meeting of the Board of Members of the multi-member limited liability company or partnership, or of the General Meeting of Shareholders of the joint-stock company, or the resolution or decision of the owner of the single-member limited liability company on change of business lines. <0}
2. After receiving the application, the Business Registration Office shall give the confirmation slip to the enterprise, examine the validity of documents and market access conditions applied to foreign investors in accordance with regulations of the Law on investment, and update information about the enterprise’s business lines on the National Enterprise Registration Database. The Business Registration Office shall issue a certificate of changes to enterprise registration information to the enterprise at its request.
During its operation, a business has the right to engage in business activities in other business lines, but it must ensure compliance with the legal regulations regarding additional notification and changes in its business lines.
How much is the fine imposed upon an enterprise for providing dishonest information in the application for changes to enterprise registration information in Vietnam? (Image from the Internet)
Vietnam: Is providing dishonest information in the application for changes to enterprise registration information a violation of the law?
Pursuant to the provisions of Clause 4, Article 16 of the Law on Enterprise 2020 on the prohibited actions:
- Issuing or refusing to issue the Certificate of Enterprise registration against regulations of this Law; requesting the founder to submit additional documents against regulations of this Law; delaying, obstructing, harassing enterprise founders and business operation of enterprises.
- Obstructing the enterprise’s owner, members/partners/shareholders from performing their rights and obligations prescribed in this Law and the enterprise’s charter.
- Doing business as an enterprise without applying for enterprise registration; carrying on busines operation after the Certificate of Enterprise Registration has been revoked or while the enterprise is being suspended.
- Providing dishonest or incorrect information in the enterprise registration application or application for changes to enterprise registration information.
- Declaring false charter capital; failure to contribute adequate charter capital as registered; deliberate contribution of assets with false value.
- Engaging in banned business lines or business lines from which foreign investors are banned; engaging in restricted business lines without fulfillment of conditions or failure to maintain fulfillment of conditions during operation in restricted business lines.
- Frauds, money laundering, terrorism financing.
Therefore, providing dishonest or incorrect information in the enterprise registration application or application for changes to enterprise registration information is a prohibited action.
Thus, providing dishonest information in application for changes to enterprise registration information is a violation against regulations. Violators will be imposed fines according to the law.
How much is the fine imposed upon an enterprise providing dishonest information in application for changes to enterprise registration information in Vietnam?
Pursuant to Article 43 of Decree 122/2021/ND-CP on fines imposed for violations against regulations on preparing applications for enterprise registration:
Violations against regulations on preparing applications for enterprise registration
A fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed for providing untruthful, inaccurate information in an application for enterprise registration or application for changes to enterprise registration information to obtain the enterprise registration certificate or certificate of changes to enterprise registration information.
Thus, a fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed for for providing untruthful information in an application for changes to enterprise registration information.
*Note: The fines for administrative violations above are imposed upon organizations. For the same violation, the fine incurred by an individual is 1/2 (half) that incurred by an organization (Clause 2 Article 4 of Decree 122/2021/ND-CP)
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