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Support for Foreign Business Merger Procedures by Specialized Attorneys in Ho Chi Minh City — Latest Update

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 The merger of foreign enterprises into the Vietnamese market presents substantial opportunities but also encounters numerous challenges. Evaluating the merger process in Vietnam requires a thorough understanding of legal regulations, tax requirements, and compliance with local laws. Foreign enterprises must carefully study investment regulations, approval procedures from competent authorities, and the feasibility of integrating corporate culture to ensure success. This not only optimizes the benefits derived from the merger but also minimizes risks and ensures full compliance with legal requirements in Vietnam.
This article has been advised by specialized attorneys at BKC Law.

What is a Business Merger?

 Support for Foreign Business Merger Procedures by Specialized Attorneys in Ho Chi Minh City — Latest Update

In the narrow sense, a business merger is a transaction in which one or more enterprises relinquish their legal personality to join another enterprise. The receiving enterprise assumes all assets, rights, legitimate interests, and obligations of the merged enterprise.
Pursuant to Article 201 of the Law on Enterprises 2020, a merger is defined as: One or more companies (hereinafter referred to as the merged company) merge into another company (hereinafter referred to as the receiving company) by transferring all assets, rights, obligations, and legitimate interests to the receiving company, while simultaneously terminating the existence of the merged company.

Conditions for Merger of Foreign Enterprises

Regarding enterprise type: Current law does not mandate that merging enterprises must be of the same type. Therefore, enterprises of different types (joint-stock companies, limited liability companies, partnerships) may still proceed with a merger in accordance with the law.
In addition, pursuant to Clause 3, Article 201 of the Law on Enterprises 2020, companies undertaking a merger must ensure compliance with the provisions of the Competition Law 2018 concerning company mergers.
From this, it can be concluded that the condition for a business merger is that the merger must not cause or have the potential to cause significant restrictive effects on competition in the Vietnamese market. There is no requirement that the merged enterprise and the receiving enterprise must be of the same type.

Dossier and Procedures for Merger of Foreign Enterprises

Support for Foreign Business Merger Procedures by Specialized Attorneys in Ho Chi Minh City — Latest Update
Step 1: Preparation of the dossier.
The dossier includes:

  • Merger contract (containing the main contents: name and head office address of the receiving company; name and head office address of the merged company; merger procedures and conditions; labor utilization plan; method, procedure, timeline, and conditions for conversion of assets, capital contributions, shares, and bonds of the merged company into capital contributions, shares, and bonds of the receiving company; merger implementation timeline).
  • Draft Charter of the receiving company.

Step 2: The members, owners, or shareholders of the involved companies approve the merger contract and the Charter of the receiving company.

  • Proceed with enterprise registration for the receiving company.
  • Send the merger contract to all creditors and notify employees within 15 days from the date of approval of the merger contract and the Charter of the receiving company.

Step 3: The business registration authority updates the legal status of the merged company on the National Enterprise Registration Database and carries out changes to the enterprise registration contents for the receiving company.
In cases where the merged company’s head office is located outside the province or centrally-run city where the receiving company’s head office is situated, the business registration authority at the location of the receiving company’s head office shall notify the business registration authority at the location of the merged company’s head office to update the legal status of the merged company on the National Enterprise Registration Database.
Registration procedure with the licensing authority
Time limit: Within 10 days from the date of completion of the merger
Dossier includes: Pursuant to Clause 2, Article 61 of Decree 01/2021/ND-CP

  • Merger contract;
  • Resolution or decision approving the merger contract and a copy of the meeting minutes of the Members’ Council (for limited liability companies with two or more members and partnerships) or the General Meeting of Shareholders (for joint-stock companies) approving the merger contract of the receiving company;
  • Resolution or decision approving the merger contract and a copy of the meeting minutes of the Members’ Council (for limited liability companies with two or more members and partnerships) or the General Meeting of Shareholders (for joint-stock companies) approving the merger contract of the merged company, except where the receiving company is a member or shareholder holding more than 65% of the charter capital (for limited liability companies and partnerships) or voting shares (for joint-stock companies) of the merged company;
  • Power of attorney for the individual performing enterprise registration procedures (in cases of authorized submission) and a certified copy of the personal identification documents of the person submitting the dossier.
  • Other relevant dossiers in cases where the merger results in changes to the enterprise registration information of the receiving company as prescribed in Chapter VI of Decree 01/2021/ND-CP.

Submission location: The Business Registration Office where the receiving company has its head office.
Submission methods:

  • Direct submission at the Business Registration Office;
  • Submission via postal service to the Business Registration Office;
  • Online submission through the National Enterprise Registration Portal.

Processing time limit: 03 working days

Support Services for Merger Procedures of Foreign Enterprises from BKC Law

At BKC Law, we specialize in providing comprehensive support services for merger procedures of foreign enterprises, assisting clients in completing the merger process swiftly and efficiently. Our experienced team of attorneys and experts offers in-depth consultation and execution of legal procedures related to mergers, from dossier preparation and legal due diligence to completing registration procedures and ensuring compliance with the requirements of competent authorities. With dedicated and professional support from BKC Law, clients can rest assured that the merger process will proceed smoothly and in full compliance with the law, while maximizing benefits for their enterprise.
Contact our attorneys today for free consultation and begin addressing your legal matters promptly and effectively!
Phone: 0901 3333 41
Email: info@bkclaw.vn
Office in District 1: 9th Floor, Diamond Plaza Building, 34 Le Duan Street, District 1, Ho Chi Minh City
Office in Binh Tan: 41 Ten Lua Street, Binh Tan District, Ho Chi Minh City

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