Business registration for single-member limited liability companies established on the basis of consolidation

A. PROFILE COMPOSITION

An applicant shall prepare documents for enterprise registration as specified in Article 24 of Decree No.01/2021/ND-CP.

Please follow the link to get the procedure for REGISTRATION OF ESTABLISHMENT OF A SINGLE-MEMBER LIMITED LIABILITY COMPANY

In addition to the above documents, in case of consolidation, the dossier shall include the following:

  1. Consolidation contract.
  2. Resolutions and decisions of consolidated companies ratifying the consolidation contract and a copy of the meeting minutes of the Members’ Council (for multi-member limited liability companies, and partnerships), or the General Meeting of Shareholders (for joint-stock companies) ratifying the consolidation contract to set up a new company.
  3. A valid copy of the enterprise registration certificate or other equivalent papers of the consolidated companies.
  • Quantity: 01 set.

B. SEQUENCE

Step 1: Prepare a consolidation contract and a charter of the consolidating company.

Consolidated companies shall prepare a consolidation contract with the following contents:

  • Names of consolidating company and consolidated companies.
  • Head office’s address of consolidating company and consolidated companies.
  • Procedures and conditions for consolidation.
  • Labour utilization plan.
  • Time, procedure, and conditions for transferring assets, shares, stakes, and bonds of the consolidated companies to the consolidating company.
  • Duration for implementation of the consolidation.

Step 2: The members, owners, or shareholders of the consolidated companies shall ratify the consolidation contract, the consolidating company’s charter, elect or designate the Chairman of the Members’ Council, the President, the Director/General Director of the consolidating company and apply for registration of the consolidating company in accordance with the law.

Note: If the consolidating company has a total market share of between 30% and 50% in the relevant market, the legal representative of the consolidated company shall notify the competition authority prior to conducting the consolidation, unless otherwise provided by the Competition Law.

Consolidating companies with a total market share of more than 50% in the relevant market are banned from consolidation unless otherwise provided by the Competition Law.

Step 3: The consolidation contract shall be sent to creditors, clients, and employees within 15 days from the day on which the resolution is ratified.

Step 4: Registration for a new company that is a single-member limited liability company.

Note: After the consolidating company is registered, the consolidated companies shall cease to exist. The consolidating company shall inherit the lawful rights and interests, liabilities, unpaid debts, employment contracts, and other obligations of the consolidated companies.

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