BUSINESS TRANSFORMATION
1. Convert a private enterprise into a limited liability company
The basic difference between a Limited Liability Company and a private enterprise is its legal status and responsibility for financial obligations. A private enterprise does not have legal status. In addition to the registered investment capital, the owner must be responsible with all of his or her assets for all activities of the enterprise, while a limited liability company has legal status and the company’s owner is only responsible for the registered charter capital, so with such advantages, many private enterprises have now converted their models to suit the production and business activities.
Conversion registration dossier includes:
- Application for business registration;
- Charter of the converted company;
- Owner’s decision on conversion;
- List of creditors and unpaid debts, including tax debt and payment deadline; list of current employees; list of unliquidated contracts;
- List of members in case of conversion into a limited liability company with two or more members;
- Valid copies of personal identification documents of company members in case members are individuals (ID card/CCCD or valid Passport); A valid copy of the Business Registration Certificate or other equivalent documents in case the company members are organizations;
- Written commitment of the owner of a private enterprise to be personally responsible with all of his or her assets for all unpaid debts of the private enterprise and to commit to paying the debt in full when due. ;
- Written agreement with the parties to the unliquidated contract on the conversion of the limited liability company to receive and perform those contracts;
- Written commitment of the private enterprise owner or agreement between the private enterprise owner and other capital contributing members on the reception and use of existing employees of the private enterprise.
The order of execution:
- Within 05 working days from the date of receipt of the application, the Business Registration Authority reviews and issues a Business Registration Certificate if all conditions are met. In case the dossier is invalid, the Business Registration Authority will issue a notice of amendment and supplementation.
- Within 07 working days from the date of issuance of the Business Registration Certificate, the Business Registration Authority updates the legal status of the business on the National Business Registration Database.
Notes after converting business type:
- Within 30 days from the date of issuance of the new Business Registration Certificate, the enterprise must publish the business registration content on the National Business Registration Portal.
- Re-engrave the seal and before using the new seal, the company must notify the Business Registration Office of the seal model and number of seals according to Appendix II-9 in Circular 20/2015/TT-BKHDT.
2. Convert a one-member limited liability company into a joint stock company
Enterprises that need to expand their business scale and mobilize diverse sources of capital then the Joint Stock Company type has the most advantage.
Conversion method
- Transfer a portion of capital contribution to at least 2 or more other individuals or organizations and then convert into a joint stock company;
This method is easy to implement, simplifies administrative procedures and does not change the company’s charter capital.
Sequence of conversion according to the method of transferring capital contribution
– Step 1: The owner of the one-member LLC makes a decision on capital transfer; The member receiving the transfer decides on the transfer of capital;
– Step 2: The Parties sign the capital transfer contract and complete the payment of the capital transfer fee;
– Step 3: Prepare documents according to regulations on conversion into a Joint Stock Company. The Shareholders agree on the construction of the Charter of the Joint Stock Company;
– Step 4 : Submit documents and register for Enterprise conversion at the Department of Planning and Investment where the One Member LLC is headquartered;
– Step 5 : Engrave and announce the seal sample of the converting Company;
– Step 6 : The company posts a statement according to the provisions of law.
Profile components
- Application for business registration;
- List of shareholders
- Charter of the converted Company;
- Valid copies of the following documents:
- Individual: ID card/Citizen identification card/Valid passport;
- Organization: enterprise registration certificate/business registration certificate,
- For shareholders who are foreign organizations, a copy of the Business Registration Certificate or equivalent document must be consularly legalized;
- Investment registration certificate for foreign investors according to the provisions of the Investment Law;
- Contract for transfer of capital contribution or documents proving completion of transfer;
- Owner’s decision to convert the company;
3. Convert a 1-member LLC to a 2-member LLC
In case of converting a one-member LLC into a LLC with two or more members, the enterprise’s conversion registration dossier includes:
Application for business conversion;
The company’s charter is converted according to the provisions of Article 22 of the Enterprise Law;
List of members according to the form issued by the Ministry of Planning and Investment and accompanying documents:
- In case the members are individuals: a valid copy of one of the personal identification documents of the company members
- In case the company member is an organization: copy of Business Registration Certificate or Enterprise Registration Certificate;
Transfer contract or documents confirming the donation of a portion of the company’s ownership rights in case the company owner transfers or donates a portion of his/her ownership in the company to one or several individuals other;
Decision of the company owner on raising additional capital contribution in case the company mobilizes additional capital contribution from one or several other individuals.
Original Certificate of Enterprise Registration or Certificate of Business Registration and Certificate of Tax Registration or Certificate of Business Registration and Tax Registration;
Other documents if registered for conditional business:
- Document certifying legal capital from a competent agency or organization (for businesses conducting business lines that, according to the law, must have legal capital).
- A valid copy of the practicing certificate of one or several individuals according to regulations for companies conducting business in industries and occupations that are required by law to have a practicing certificate.
Business conversion documents are submitted to the Business Registration Office – Department of Planning and Investment of the province/city. Within 05 working days from the date of receipt of the conversion dossier, the business registration agency or state investment management agency has the authority to re-issue the Business Registration Certificate or Investment Certificate. corresponding.
From July 1, 2015, when converting a 1-member LLC to a 2-member LLC, there are the following differences:
The business registration certificate only has 4 contents including:
- Company’s name;
- Address of the enterprise’s headquarters
- Charter capital of the enterprise
- Legal representative information (For LLCs, there is also additional information about company members).
When a business changes or adds additional content: business lines, list of shareholders, it will not be shown on the Business Registration Certificate. The Department of Planning and Investment will issue an additional Confirmation of changing business registration information with information about: business name, business code, registered business lines and shareholder information.
Legal seal of the enterprise
Businesses can choose their own seal model and quantity.
During the process of converting a 1-tv LLC to a 2-tv LLC without changing the company name and without changing the headquarters address to a different district, the procedure for changing the seal is not required.
In case of changing the seal, after engraving the legal entity seal, the enterprise seal engraving unit must carry out procedures for registering the seal sample and publishing the seal sample on the National Business Registration Portal.
Therefore, from July 1, 2015, businesses no longer have a Seal Sample Certificate issued by the police like before.
Information about business locations, branches, and former representative offices:
When converting a 1-member LLC to a 2-member LLC, information about the old business location, branches, and representative offices will not be shown on the Business Registration Certificate: Currently, for information Regarding business locations, branches, and old representative offices, they are only shown on the business registration and tax registration system, not on legal documents issued to businesses, and there are currently no regulations to determine Get this old information.
Establishment of branches, representative offices, and business locations:
When an enterprise establishes a branch, representative office, or business location, it will be issued a separate certificate, different from the old business registration certificate. Information about the business location is issued on the same Certificate. business registration.
4. Convert a limited liability company with two or more members into a joint stock company
LLCs with two or more members that want to convert into a Joint Stock Company have many different conversion methods. Below, we provide our customers with the necessary processes and procedures during the company conversion process.
Conversion method:
- Only change the type of company without mobilizing other organizations or individuals to contribute capital or not selling capital contributions to other organizations or individuals.
- Convert by mobilizing other organizations and individuals to contribute capital. In this case, in addition to changing the type of company, there is also a change in owner; These are organizations and individuals who contribute additional capital and increase charter capital.
- Convert by selling all or part of the capital contribution to one or several other organizations or individuals. In this case, although there is no change in charter capital, there is a change in owner due to capital transfer.
- Combine the above methods
Documents need to be prepared
- Application for business registration;
- List of shareholders;
- Company rules
- Valid copies of the following documents:
- Individual: ID card/Citizen identification card/Valid passport;
- Organization: enterprise registration certificate/business registration certificate,
- For shareholders who are foreign organizations, a copy of the Business Registration Certificate or equivalent document must be consularly legalized;
- Investment registration certificate for foreign investors according to the provisions of the Investment Law;
- Contract for transfer of capital contribution or documents proving completion of transfer
- Decision of the board of members on company conversion;
- Minutes of the meeting of the board of members on company conversion;
5. Convert joint stock company to limited company
On July 1, 2015, the Enterprise Law 2014 took effect when businesses carried out the procedure for converting joint stock companies to limited liability companies with many changes.
Documents for converting a joint stock company to a limited liability company:
– Application for business registration;
– Draft of Company’s charter
– List of shareholder members and accompanying documents as follows:
+ For individual members: copy of ID card, passport or other legal personal identification.
+ For shareholders who are organizations: copy of the establishment decision, business registration certificate or other equivalent documents of the organization; Authorization document, ID card, passport or other legal personal identification of the authorized representative.
+ For shareholders who are foreign organizations, a copy of the Business Registration Certificate must be authenticated by the agency where the organization was registered no more than three months before the date of submitting the business registration application.
– Notes when converting a joint stock company to a limited liability company:
+ When converting a joint stock company to a limited liability company with additional business lines requiring legal capital: Enterprises must increase charter capital at least equal to the required legal capital. During operation, legal capital conditions must be met according to the provisions of law.
+ When converting a joint stock company to a limited liability company with additional business lines that require a practice certificate, the business does not need to present a practice certificate as prescribed. However, during the operation process, the Director or General Director and other individuals must ensure that they have a certificate according to the provisions of law or must apply for a sublicense according to specialized legal regulations. branch.
Re -register property ownership:
After being granted a new business registration certificate, the limited liability company must carry out procedures to re-register property ownership for assets transferred from a joint stock company to a limited liability company in Vietnam. competent state agency to grant registration. Re-registration of property ownership is not subject to registration fees.
From July 1, 2015, when converting a joint stock company to a limited liability company, there are the following differences:
The business registration certificate only has 4 contents including:
- Company’s name;
- Address of the enterprise’s headquarters
- Charter capital of the enterprise
- Legal representative information (For LLCs, there is also additional information about company members).
When a business changes or adds additional content: business lines, list of shareholders, it will not be shown on the Business Registration Certificate. The Department of Planning and Investment will issue an additional Confirmation of changing business registration information with information about: business name, business code, registered business lines and shareholder information.
Legal seal of the enterprise
Businesses can choose their own seal model and quantity.
Therefore, when converting a joint stock company to a limited liability company, you will not have to cancel the old seal because according to the new regulations, the enterprise has the right to decide on the quantity, form, and content of its legal seal. However, after engraving the legal entity’s seal, the enterprise seal engraving unit must carry out procedures for registering the seal sample and publishing the seal sample on the National Business Registration Portal.
Therefore, from July 1, 2015, businesses no longer have seal sample certificates issued by the police like before.
Procedures for publishing information about converting a joint stock company to a limited liability company on the National Business Information Portal
After changing business registration, enterprises must announce changed information on the national business portal within 30 days from the date of change.
Contact Vipatco Company for advice and the best service at the most competitive prices Email vietstar@vipatco.vn
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