In this article, NP Law outlines several main points to assist enterprises in better understanding the legal regulations governing the temporary suspension of business operations. This aims to help businesses avoid the risk of their suspension dossiers being rejected or subjected to administrative fines under applicable laws.

I. In which cases may a business be temporarily suspended?

According to current legislation, a business may temporarily suspend its operations in the following cases:

- At the request of the enterprise itself;

- Upon request by the business registration authority or a competent state agency, in the following circumstances:

+ Temporary suspension of business in conditional business lines or sectors, or conditional market access sectors for foreign investors, when it is found that the enterprise fails to meet the statutory conditions;

+ Suspension of business as requested by other competent agencies in accordance with the law.

II. What is the procedure for temporarily suspending business operations?

Step 1: Preparing the following dossier:

- Application for temporary suspension of business activities;

- Minutes of the Members' Council or Board of Directors meeting (applicable to multi-member Limited Liability Companies or joint-stock companies);

- Decision/Resolution on business suspension of the Company;

- Power of attorney authorizing NP Law to implement the aforementioned procedures.

Step 2: Submitting the dossier to the Business Registration Office under the Department of Planning and Investment of the province/city where the company’s head office is located.

Notes: 

- Notice period for temporary suspension: The enterprise must notify the Business Registration Office at least 03 working days prior to the date of suspension.

- Permissible suspension period: The maximum duration of each business suspension is no more than 01 year, and there is no limit on the number of subsequent suspensions.

III. What are the fines for violations related to business suspension?

In case of failure to notify or late notification to the Business Registration Office of the time and duration of its business suspension or resumption, it shall be subject to an administrative fine of between 1,000,000 VND and 2,000,000 VND.

1. Important notes when suspending business operations

- Prior to suspension, the enterprise must fulfill all tax obligations, settle any outstanding debts, and execute all signed contracts with customers and employees.

- The enterprise is still required to submit tax declarations for the period during which it was operational.



2. Legal basis

- Law on Enterprises 2020;

- Decree No. 01/2021/ND-CP on enterprise registration;

- Decree No. 122/2021/ND-CP on administrative fines in the field of planning and investment;

- Circular No. 01/2021/TT-BKHDT guiding enterprise registration.

The above are key legal provisions that businesses must consider before proceeding with temporary suspension of operations. To save time and ensure compliance, enterprises are encouraged to contact NP Law for comprehensive consultation and professional support.