After enterprise goes bankrupt, can the owner of a limited liability company in Vietnam establish another one?
I am the owner of a limited liability company, my company has just gone bankrupt, can I set up another business in Vietnam?
After enterprise goes bankrupt, can the owner of a limited liability company in Vietnam establish another one?
Pursuant to Clause 2, Article 17 of the Law on Enterprises 2020, there are provisions on the following organizations and individuals without the right to establish and manage enterprises in Vietnam:
2. The following organizations and individuals do not have the right to establish and manage enterprises in Vietnam:
a) State authorities, People’s armed forces using state-owned assets to establish enterprises to serve their own interests;
b) Officials and public employees defined by the Law on Officials and the Law on Public Employees;
c) Commissioned officers, non-commissioned officers, career military personnel, military workers and public employees in agencies and units of Vietnam People’s Army; commissioned officers, non-commissioned officers and police workers in police authorities and units, except for those designated and authorized representatives to manage state-owned stakes in enterprises or to manage state-owned enterprises;
d) Executive officers and managers of state-owned enterprises prescribed in Point a Clause 1 Article 88 of this Law, except those who are designated as authorized representatives to manage state-owned stakes in other enterprises;
dd) Minors; people with limited legal capacity; incapacitated people; people having difficulties controlling their behaviors; organizations that are not juridical persons;
e) People who are facing criminal prosecution, kept in temporary detention, serving an imprisonment sentence, serving an administrative penalty in a correctional institution or rehabilitation center, has limited legal capacity or is incapacitated, is not able to control his/her own behaviors, is banned by the court from holding certain positions or doing certain works; other cases prescribed by the Law on Bankruptcy and the Anti-corruption Law.
If requested by the business registration authority, the applicant shall submit the judicial records;
g) Juridical persons that are banned from business operation or banned from certain fields as prescribed by the Criminal Code.
Thus, according to the above provisions, the owner of a limited liability company in Vietnam that is bankrupt does not have the right to establish a business. So you still have the right to start a new business after the old business goes bankrupt. However, you will be prohibited from starting a business if you violate some provisions of the Bankruptcy Law.
Who does not have the right to establish a new business after the bankruptcy of an old one in Vietnam?
Pursuant to Clause 3, Article 130 of the Bankruptcy Law 2014 , there are provisions on the ban from holding office after the enterprise or cooperative is declared bankrupt as follows:
3. If any manager of the entity declared bankrupt intentionally commits the violations against the regulations in Clause 1 Article 18, Clause 5 Article 28 and Clause 1 Article 48 of this Law, the Judge shall consider and give a Decision on the prohibition of the establishment of the enterprise or cooperative and working as manager of any enterprise or cooperative within 03 years from the day on which People’s Court issues the Decision on declaration of bankruptcy.
According to this Article, if you violate the above provisions when opening bankruptcy procedures, the court may issue a decision not to be entitled to set up a business within 3 years in Vietnam.
Best Regards!
