On 23 August 2018, the Government issued a new decree (“Decree 108/2018/ND-CP”) on amendments to enterprise registration. Decree 108/2018/ND-CP came into effect on 10 October 2018. In comparison with the previous legislation (“Decree 78/2015/ND-CP”), Decree 108/2018 has introduced the following notable changes:
|1||Requirement on company stamp||
Enterprises are not required to affix the company stamp in the following documents:
Previously, Decree 78/2015/ND-CP was silent on whether the company stamp is required to be affixed on these documents and the practice of the licensing authorities was to require the stamp to be affixed. This change lightens burden for companies and allows more flexibility (e.g. a company may submit documents even if the company stamp is damaged, unavailable etc.).
|2||Power of Attorney||
The power of attorney for the person in charge of representing an enterprise on the matter of enterprise registration is not required to be notarised or certified.
Decree 78/2015/ND-CP was silent on this issue and therefore gave rise to inconsistent practice between different provinces. Now, with this addition in Decree 108/2018/ND-CP, the practice is standardised and the enterprise registration process is made easier.
|3||Business Location||Decree 108/2018/ND-CP has removed the requirement that an enterprise may only establish a business location in the same central province or city where the enterprise has its head office or a branch. This means the enterprise may establish its business location(s) where it does not have its head office or branch.|
|4||Reduction of charter capital||
The latest financial statement is not required to be submitted with competent business registration authority under the process of registration of reduction of charter capital.
Previously, Decree 78/2015/ND-CP includes the latest financial statement as a required document when registering for reduction of charter capital. This change lessens the documents required and makes the overall process easier.
|5||Notification of change of founding shareholder of joint stock company||A joint stock company is required to notify the change of founding shareholder(s) only in the case where the founding shareholder(s) have not paid or has not paid in full the share which they intend to subscribe. In comparison with Decree 78/2015/ND-CP, the joint stock company is not required to notify such change when the founding shareholder(s) transfer their shares.|
Overall, Decree 108/2018/ND-CP introduces very positive changes to simplify and standardise enterprise licensing procedures.
If you have any questions or require any additional information, please contact Hung Nguyen or the ZICO Law partner you usually deal with.
This alert is for general information only and is not a substitute for legal advice.