Vietnam: Execution of tax or invoice-related administrative penalty charge decisions in cases where sanctioned persons are dead

According to Article 41 of the Decree No. 125/2020/NĐ-CP of Vietnam’s Government, execution of tax or invoice-related administrative penalty charge decisions in cases where sanctioned persons are dead or missing; sanctioned entities are dissolved or bankrupt is guided as follows:

1. In cases where the sanctioned person is dead or missing; the sanctioned entity is dissolved or bankrupt, fine amounts specified in penalty charge decisions shall be invalidated while remedies specified in penalty charge decisions remain in force.

The person issuing the penalty charge decision must issue the decision on execution of part of that decision within 60 days after receipt of the notice stating that the sanctioned person is dead or missing; the sanctioned entity is dissolved or bankrupt.

If the penalty charge decision does not include any remedy, the person accorded the sanctioning authority shall issue the decision on suspension of execution of the penalty charge decision.

2. Bases for determining whether a person has died, gone missing; an entity has been dissolved or bankrupt:

The death certificate or the notice of death or other substitutes of notice of death under laws on civil status, or the court’s decision stating a person is dead or missing (original or duplicate copy required by laws) with respect to the case of a dead or missing person;

The notice of dissolution of an enterprise or cooperative issued by the business registration authority or the cooperative registration authority with respect to the case of dissolution of an enterprise or cooperative; the notice of termination of TIN of the tax agency with respect to the case in which the dissolved entity is not an enterprise or cooperative (original or duplicate copy required by laws);

The bankruptcy declaration decision with respect to the bankrupt enterprise or cooperative (original or duplicate copy required by laws).

3. The decision on execution of a part of the penalty charge decision must include the following: Revocation of the fine and reasons for such revocation; contents of the penalty charge decision that continue to be executed, name of the entity or person responsible for the continued execution of the penalty charge decision; execution time limit.

4. The succession of obligations to execute the remedy from the dead, missing person or the dissolved or bankrupt entity

The successor shall be responsible for executing the remaining part of the penalty charge decision regarding the remedy within the scope of the decedent's estate.

If the estate has not yet been divided, the remaining part of the penalty charge decision regarding the remedy that is bequeathed by the decedent shall be executed by the custodian of such estate.

If the estate has already been divided, each successor shall execute the remaining part of the penalty charge decision regarding the remedy that is bequeathed by the decedent, respectively, provided that such part does not exceed the value of estate that he/she inherits, unless otherwise agreed.

In case where the State or any entity receives the estate under will, they shall be responsible for executing the remaining part of the penalty charge decision regarding the remedy that is bequeathed by the decedent in the same way as in the case of the successor who is a person.

If there is none of the testate successor or the successor by operation of law, or there is the successor who disclaims the estate, regulations laid down in civil legislation shall be implemented.

The court-appointed guardian or custodian of the property owned by the person declared missing shall be responsible for executing the remaining part of the penalty charge decision (the remedy) within the scope of the property that he/she manages on behalf of the missing person.

If the dissolved entity is a subordinate entity or a business location of an enterprise; the entity is dissolved due to the reorganization of an enterprise, cooperative or other entity; the branch or representative office of a foreign trader or the management office of a foreign contractor in Vietnam is dissolved, the dissolved entity shall not be exempted from executing any fine prescribed in a penalty charge decision.

View more details at the Decree No. 125/2020/NĐ-CP of Vietnam’s Government, effective from December 05, 2020.

Thuy Tram

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