Procedure for terminating the operation of a foreign trader's representative office in Vietnam

Insights

Posted on: 01/11/2024

1. Overview of the procedure for terminating the operation of a foreign trader's representative office in Vietnam

No.	Categories	Description
1	Authority for receiving and processing applications[1]	Provincial-level Department of Industry and Trade; or Management Board of industrial parks, export processing zones, economic zones, or high-tech zones (in case the representative office is located in an Industrial Park, Economic Zone, Export Processing Zone, or High-Tech Park).
2	Method of application submission	The foreign trader submits an application to the licensing authority to terminate the operation of the representative office in one of three ways[2]: in person; by post; online (where eligible).
3	Documents for dossier	Submission of the 01 dossier containing[3]: Notice of termination of the operation of the Representative Office in the form prescribed by the Ministry of Industry and Trade (Form TB, Circular No. 11/2016/TT-BCT), signed by the authorized representative of the foreign trader, except for the cases specified in Clause 5, Article 35 of Decree 07/2016/ND-CP; A copy of the document from the licensing authority not to renew the licence to establish a representative office (for cases specified in Clause 4, Article 35 of Decree 07/2016/ND-CP) or a copy of the decision to revoke the licence to establish a representative office issued by the licensing authority (for cases specified in Clause 5, Article 35 of this Decree); A list of creditors and outstanding debts, including tax liabilities and unpaid social insurance contributions; List of employees and their corresponding current benefits; The original licence for the establishment of the Representative Office.
4	Fee	Free of charge.
5	Result	The Licensing Authority publishes the termination of the Representative Office's operation on its electronic information portal.

2. Conditions for implementation, procedures, and processing time:

No.	Categories	Description
1	Conditions for implementation	In the following cases, the operation of the representative office of a foreign trader may be terminated[4]: Upon request of the foreign trader. When the foreign trader terminates operations according to the laws of the country or territory where it is established or registered for business. Upon expiration of the operational term as stated in the License for establishing the Representative Office without a renewal request from the foreign trader. Upon expiration of the operational term as stated in the License for establishing the Representative Office without approval for renewal by the Licensing Authority. When the License for establishing the Representative Office is revoked under the provisions of Article 44 of Decree 07/2016/ND-CP. When the foreign trader or the Representative Office no longer meets any of the conditions specified in Articles 7 and 8 of Decree 07/2016/ND-CP.
2	Relevant obligations	In addition to completing the procedures for termination of the Representative Office with the Licensing Authority, the foreign trader has the following obligations[5]: The foreign trader and the Representative Office must publicly announce the termination of operations and fulfill other obligations as prescribed by law when the Representative Office ceases operations. The foreign trader whose Representative Office has ceased operations is responsible for fulfilling contracts, settling debts, including tax liabilities, and fully addressing the lawful rights and benefits of employees who worked at the Representative Office in accordance with legal regulations. Other obligations as prescribed by law (if any)
3	Procedure and time of implementation:	Step 1: Perform the procedure for terminating the operation of the representative office of the foreign trader at the Department of Industry and Trade; Time: 05 - 07 working days Step 2: Perform the tax settlement procedure, terminate the validity of the representative office tax code and the personal income tax code of the head of the representative office, of the employees working at the representative office; Time: 20 - 30 working days Step 3: Perform the procedure for social insurance settlement and close the unit's social insurance code; Time: 07 - 10 working days Step 4: Perform the procedure for returning the representative office seal at the Police Department on Administrative Management of Social Order of the Provincial or City Police; Time: 05 - 07 working days Step 5: Submit the results in Steps 2, 3, 4 to the Department of Industry and Trade to receive the results of the Permission to Terminate the representative office of the foreign trader in Vietnam. Time: 05 - 07 working days

3. Procedure for Submitting the Application to Terminate the operation of a Foreign Trader's Representative Office in Vietnam (at Department of Industry and Trade)

Note 1:

In addition to the procedures at the Department of Industry and Trade of the province or city, the representative office of the foreign trader must also complete procedures with other competent state authorities to effectively terminate operations. These procedures include, but are not limited to, the following activities (mentioned in Section 2 above):

Completing tax finalization procedures and deactivating the tax identification number of the representative office and the personal tax identification numbers of the head of the representative office and employees working there;
Completing social insurance finalization procedures and closing the insurance unit code;
Returning the representative office’s seal to the issuing police authority (if applicable).

Note 2:

In case the representative office still has disputes with employees, the representative office will be considered as not completing the termination procedures and will not be notified of the termination by the licensing authority.

Note 3:

In addition to the above procedures, the foreign trader and the representative office must publicly post the termination notice at the representative office's headquarters. Regarding employees, the foreign trader and the representative office must also notify all employees working at the representative office of the termination of the representative office's operations (via email and express delivery to ensure that employees receive it).

4. Some images of the notice of termination of operations of the Representative Office

In case the Representative Office terminates its operations upon expiration of the term and does not request to renew the License.

In case the Representative Office terminates its operations at the request of the foreign trader.

[1] Applicable to representative offices of foreign traders operating in common fields, excluding specialized sectors such as: representative offices of securities companies, fund management companies, foreign banks, foreign educational institutions, etc.

[2] Clause 1, Article 37 of Decree 07/2016/ND-CP.

[3] Clause 1, Article 36 of Decree 07/2016/ND-CP.

[4] Article 35 of Decree 07/2016/ND-CP.

[5] Article 38 of Decree 07/2016/ND-CP.