In the course of restructuring, downsizing, or shifting business strategy, many companies face the decision on terminating a branch, representative office, or business location. This is a legal procedure requiring strict compliance, particularly the completion of tax obligations before filing, to avoid prolonged legal risk down the line.

1. Procedure of terminating a branch, representative office, or business location

This procedure applies when a company voluntarily decides on terminating a branch, representative office, or business location, regardless of whether that unit was established in the same province as the head office or elsewhere. Where a company wishes to terminate a branch that has dependent business locations, it must first complete the termination of all such locations before terminating the branch itself.

2. Conditions Under Current Regulations

– The termination decision must be approved by the corresponding competent internal authority: the owner (for single-member LLCs), the Members’ Council (for multi-member LLCs and partnerships), or the Board of Directors (for joint-stock companies);

– Before filing the termination dossier, the company/branch/representative office must complete the required procedure with the tax authority to fulfill its tax obligations — this is a mandatory prerequisite that cannot be skipped;

– The company must prepare a list of employees and their corresponding entitlements at the unit being terminated (if any);

The dossier must be filed within 10 days from the date of the termination decision.

3. Legal procedure required

– Procedure name: Registration of Termination of Branch, Representative Office, or Business Location Operations.

– The dossier is submitted to the provincial Business Registration Office where the branch, representative office, or business location is located — in person, by post, or online via the National Business Registration Portal. The core dossier includes: a notification of termination; the resolution/decision and minutes of the relevant internal meeting (or the owner’s decision) approving the termination; a certificate confirming completion of tax obligations; and a list of employees and their entitlements (if any).

– Outcome: The Business Registration Office issues a notice of termination for the branch, representative office, or business location, updating its legal status on the National Business Registration Portal. This procedure is exempt from registration fees.

4. Penalties for Violations

Where the provincial Business Registration Office has issued a notice that a unit is “undergoing termination procedures” but, after 180 days, the company has not filed the formal dossier and no objection has been raised by the tax authority or other related parties, the Business Registration Office will automatically update the unit’s status to “terminated.”

A company that fails to complete its tax obligations before filing, provides false information, or fails to meet the 10-day filing deadline from the date of the decision may be subject to administrative penalties under current planning and investment regulations.

>> PROCEDURE FOR ESTABLISHING A BRANCH OR REPRESENTATIVE OFFICE OF A VIETNAMESE ENTERPRISE https://linconlaw.vn/procedure-for-establishing-a-branch-or-representative-office-of-a-vietnamese-enterprise/

>> RESTRICTIONS ON BRANCHES OF FOREIGN MERCHANTS IN VIETNAM https://linconlaw.vn/restrictions-on-branches-of-foreign-merchants-in-vietnam/