Method of sending requests for the initiation of bankruptcy process in Vietnam

Method of sending requests for the initiation of bankruptcy process in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Method of sending requests for the initiation of bankruptcy process in Vietnam

Method of sending requests for the initiation of bankruptcy process in Vietnam according to Article 30 of the Law on Bankruptcy 2014 is as follows:

- Anyone wishing to request the initiation of bankruptcy process must send the application and documents to the People’s Court either

+ directly;

+ or by post.

- The day on which the request for bankruptcy process is submitted shall be counted from the day on which the People’s Court receives the request or attested by the day on postmark.

2. Who is eligible and liable to submit written requests for initiation of bankruptcy process in Vietnam?

Persons with the eligibility and liability to submit written requests for initiation of bankruptcy process according to Article 5 of the Law on Bankruptcy 2014 include:

- Any creditor of unsecured debts or partly-secured debts is entitled to send a written request for initiation of bankruptcy process after 03 months from the payment due date for the debts which the enterprise or cooperative does not pay..

- Any employee, internal Trade Union (or the superior Trade Union if the internal Trade Union is not established) is entitled to send a written request for initiation of bankruptcy process after 03 months from the day on which the entity have to pay salaries and other debts to the employees.

- The legal representative of each enterprise or cooperative is liable to send a written request for initiation of bankruptcy process when the entity is insolvent.

- The owner of any private enterprise, the President of the Board of Directors of any joint-stock company, President of the Member assembly of any multi-member limited liability company, the owner of any single limited liability company or any general partner of any partnership is liability to submit a written request for initiation of bankruptcy process when the entity is insolvent.

- Any shareholder or any group of shareholders owning at least 20% of ordinary shares for at least 06 consecutive months is entitled to file a written request for initiation of bankruptcy process when the joint-stock company is insolvent. Any shareholder or any group of shareholders owning less than 20% of ordinary shares for at least 06 consecutive months is entitled to file a written request for initiation of bankruptcy process when the joint-stock company is insolvent if it is mentioned in the company’s charter.

- Any member of any cooperative or any legal representative of any cooperative which is a member of the cooperative union is entitled to file a written request for initiation of bankruptcy process when the entity is insolvent.

3. Competence in bankruptcy settlement of the People’s Court in Vietnam

Competence in bankruptcy settlement of the People’s Court according to Article 8 of the Law on Bankruptcy 2014 is as follows:

- The People’s Court of central-affiliated cities and provinces (hereinafter referred to as provincial People’s Court) has the competence in bankruptcy settlement for enterprises and cooperatives registered in the province and for one of the following cases:

+ There are overseas assets or involving entities.

+ The insolvent entity has branches and/or representative offices located in district and/or cities of various provinces;

+ The insolvent entity has real estate in district and/or cities of various provinces;

+ The provincial People’s Court takes the bankruptcy cases under the management of the People’s Court of a district/city of the province due to their complicacy.

- The district People’s Court has the competence in bankruptcy settlement for enterprises and cooperatives of which the headquarters are located in the district and for the cases not mentioned in Clause 1 of Article 8 of the Law on Bankruptcy 2014.

- The Supreme People’s Court shall provide guidance on implementing Article 8 of the Law on Bankruptcy 2014.

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