In what cases is the deposit of a multilevel marketing enterprise in Vietnam be used? What are the procedures for using deposit in Vietnam?
In what cases is the deposit of a multilevel marketing enterprise in Vietnam used?
Pursuant to the provisions of Clause 1, Article 53 of Decree No. 40/2018/ND-CP (amended and supplemented by Clause 37, Article 1 of Decree No. 18/2023/ND-CP) as follows:
Handling deposited amount
1. The deposit shall be used in the following cases:
a) The enterprise terminates multi-level marketing activities, but it fails to perform effective sanctioning decisions in multi-level marketing activities issued by competent authorities;
b) The enterprise terminates its multi-level marketing activities under clause 1 Article 17 of this Decree, but it fails to fulfill its obligations relating to multi-level marketing activities toward participants and there is a court's judgment on the settlement of disputes related to such obligations between the enterprise and its participants;
According to the above regulations, the deposit of a multi-level marketing enterprise is used in two cases:
- Case 1: The enterprise terminates multi-level marketing activities, but it fails to perform effective sanctioning decisions in multi-level marketing activities issued by competent authorities;
- Case 2: The enterprise terminates its multi-level marketing activities in the following cases:
+ The multi-level marketing registration certificate expires without renewal;
+ The multi-level marketing company terminates multi-level marketing activities at its own will;
+ The multi-level marketing registration certificate is revoked by the competent authority.
However, it fails to fulfill its obligations relating to multi-level marketing activities toward participants and there is a court's judgment on the settlement of disputes related to such obligations between the enterprise and its participants.
In what cases is the deposit of a multilevel marketing enterprise in Vietnam be used? What are the procedures for using deposit in Vietnam?
What are the procedures for using deposit in Vietnam?
Procedures for using deposits as provided in case 1:
Pursuant to the provisions of Clause 2, Article 53 of Decree No. 40/2018/ND-CP (amended and supplemented by Clause 37, Article 1 of Decree No. 18/2023/ND-CP) stipulating the procedures for using deposit as provided in case 1 as follows:
Step 1: If the enterprise terminates its multi-level marketing activities, but it fails to perform the competent authority's effective sanctioning decisions in multi-level marketing activities, the competent authority shall send an official letter to request the Ministry of Industry and Trade for issuing an official letter requesting the bank where the enterprise's deposit is held to withdraw money from the enterprises' deposit to implement the sanctioning decisions;
Step 2: Within 10 working days after receiving the written request, the Ministry of Industry and Trade shall issue the official letter requesting the bank where the enterprise's deposit is held to withdraw money from the enterprise's deposit to implement the sanctioning decisions.
Procedures for using deposits as provided in case 2:
Pursuant to the provisions of Clause 3, Article 53 of Decree No. 40/2018/ND-CP (amended and supplemented by Clause 37, Article 1 of Decree No. 18/2023/ND-CP) stipulating the procedures for using deposit as provided in case 2 as follows:
Step 1: Pursuant to the effective judgment or decision of the court, multi-level marketing participants shall implement the judgment enforcement request in accordance with regulations of law on civil judgment enforcement;
Step 2: In case the deposit may be used in accordance with Clause 1 Article 50 of this Decree, the judgment enforcement agency shall send the Ministry of Industry and Trade a written request enclosed with the effective judgment, copies of the decision on judgment enforcement and the decision on withdrawal of money from the enterprise's deposit account;
Step 3: Within 10 working days after receiving the written request from the judgment enforcement agency, the Ministry of Industry and Trade shall notify the judgment enforcement agency and the bank where the enterprise's deposit is held to withdraw money from the enterprises' deposit to enforce the judgment.
Note: In case the deposit cannot be used for settlement of the dispute under the judgment according to Clause 1 Article 50 of Decree No. 40/2018/ND-CP, the Ministry of Industry and Trade shall request the judgment enforcement agency to implement other judgment enforcement measures as prescribed by law.
If the deposit still remains after it is used and the enterprise still has other obligations, how will the remaining deposit be handled?
Pursuant to the provisions of Clause 5, Article 53 of Decree No. 40/2018/ND-CP (amended and supplemented by Clause 37, Article 1 of Decree No. 18/2023/ND-CP) as follows:
Handling deposited amount
…
5. If the deposit still remains after it is used according to Clause 1, Clause 2, Clause 3 and Clause 4 of this Article and the enterprise still has other obligations under the effective court judgment which has not been enforced, the remainder will be transferred to the competent judgment enforcement agency as prescribed by law.
Thus, after using the deposit according to the procedures for both cases mentioned above, and at the same time, handling the use of the deposit according to the chronological order of receiving the request to use the valid deposit.
If the deposit still remains after it is used and the enterprise still has other obligations under the effective court judgment which has not been enforced, the remainder will be transferred to the competent judgment enforcement agency as prescribed by law.
Decree No. 18/2023/ND-CP takes effect from June 20, 2023.
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