05 Special Cases Where The Owner of a Private Enterprise is Allowed to Exercise Their Rights

05 special cases where the owner of a Sole Proprietorship exercises their rights - Illustrative image.

To be specific: Article 193 of the Enterprise Law 2020 stipulates 5 special cases where the owner of a Sole Proprietorship can exercise their rights, including:

1. If the owner of a Sole Proprietorship is in temporary detention, serving a prison sentence, or undergoing administrative measures at a mandatory rehab center or an educational establishment, they shall authorize another person to exercise their rights and obligations.
2. If the owner of a Sole Proprietorship dies, the heir or one of the heirs according to the will or according to law shall become the owner of the Sole Proprietorship based on the agreement among the heirs. If the heirs cannot reach an agreement, they shall register to convert the Sole Proprietorship into a company or dissolve the Sole Proprietorship.
3. If the owner of a Sole Proprietorship dies without an heir, the heir refuses to accept the inheritance or is disqualified from the inheritance, the assets of the owner of the Sole Proprietorship shall be handled in accordance with the civil law.
4. If the owner of a Sole Proprietorship is restricted or loses civil act capacity or has difficulty in cognition and behavior control, the rights and obligations of the owner of the Sole Proprietorship shall be exercised through a representative.
5. If the owner of a Sole Proprietorship is banned by the court from practicing certain professions or doing certain jobs within the scope of the business lines of the enterprise, the owner of the Sole Proprietorship shall temporarily cease or terminate the business lines in question according to the court's decision or transfer the Sole Proprietorship to another individual or organization.

Additionally, it is noteworthy that Article 191 of the Enterprise Law 2020 stipulates that the owner of a Sole Proprietorship has the right to lease out the entire Sole Proprietorship but must notify in writing along with a notarized copy of the lease agreement to the Business Registration Authority and the Tax Authority within 03 working days from the date the lease agreement takes effect.

Furthermore, Article 192 stipulates that the owner of a Sole Proprietorship has the right to sell their Sole Proprietorship to another individual or organization.

After selling the Sole Proprietorship, the owner still has to be responsible for the debts and other financial obligations of the Sole Proprietorship incurred before the date of transfer of the enterprise, except where there is a different agreement between the owner, the buyer, and the creditors of the Sole Proprietorship.

Detailed regulations are specified in the Enterprise Law 2020, effective January 1, 2021.

Le Vy

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