Dossiers and procedures for registering a social enterprise

1. What criteria do social enterprises need to meet?

Pursuant to Clause 1, Article 10 of the Law on Enterprises 2020, the criteria for social enterprises are specified as follows:

“Article 10. Criteria, rights and obligations of social enterprises

1. Social enterprises must meet the following criteria here:

a) Is an enterprise registered and established under the provisions of this Law;

b) Operational objectives are to solve social and environmental problems for the benefit of the community;

c) Use at least 51% of the enterprise’s total annual after-tax profit to reinvest to realize the posted objectives signed.

[…]”

Accordingly, to become a Social Enterprise, it is necessary to ensure:

+ Be an enterprise registered under the provisions of this Law;

+ Operational objectives are to solve social and environmental problems for the public benefit VND;

+ Use at least 51% of the enterprise’s total annual profit after tax to reinvest to realize the registered goal.

2. What rights and obligations do social enterprises have?

Social enterprises have the rights and obligations specified in Article 10 of the Law on Enterprises 2020, specifically:

“Article 10. Criteria, rights and obligations of social enterprises

[…]

2. In addition to the rights and obligations of enterprises according to the provisions of this Law, enterprises Social enterprises have the following rights and obligations:

a) Owners and managers of social enterprises are considered, facilitated and supported in the issuance of licenses, certificates and relevant certificates according to the provisions of law;

b) To mobilize and receive sponsorship from individuals, businesses, non-governmental organizations and other Vietnamese and foreign organizations to offset management costs, operating costs of the enterprise;

c) Maintain operating objectives and conditions specified in Points b and c, Clause 1 of this Article throughout the operation process;

d) Don’t use mobilized grants for purposes other than offsetting management and operating costs to solve social and environmental issues that the enterprise has registered;

d) In case of receiving incentives and support, social enterprises must annually report to competent authorities on the business’s operations.

3. Social enterprises must notify competent authorities when they stop implementing social or environmental goals or do not use profits for reinvestment according to the provisions of Points b and c, Clause 1 of this Article.

4. The State has policies to encourage, support and promote the development of social enterprises.

5. The Government shall regulate this Article in detail.”

Accordingly, social enterprises have rights and obligations including:

– Owners and managers of social enterprises are considered, facilitated and supported in granting relevant licenses, certificates and permits according to the provisions of law;

– Mobilize and receive sponsorship from individuals, businesses, non-governmental organizations and other Vietnamese and foreign organizations to offset management costs and operating costs of the business;

– Maintain the operational objectives and conditions specified in Points b and c, Clause 1 of this Article throughout the operation process;

– Don’t use mobilized grants for purposes other than offsetting management and operating costs to solve social and environmental issues that the business has registered;

– In case of receiving incentives and support, social enterprises must annually report to competent authorities on the business’s operations.

3. What are the documents, order and business registration procedures for social enterprises?

Documents, order, and procedures for business registration for social enterprises comply with Article 28 of Decree 01/2021/ND-CP, specifically as follows:

– Documents, order, and procedures for registering the establishment of social enterprises, branches, representative offices, and business locations of social enterprises shall comply with the provisions of this Decree corresponding to each type of enterprise. Accompanying the application must be a Commitment to implementing social and environmental goals signed by the following people:

+ For private enterprises: private enterprise owners;

+ For partnerships: general partners;

+ For limited liability companies: members are individuals; legal representative or authorized representative for members who are organizations;

+ For joint stock companies: founding shareholders are individuals, other shareholders are individuals, if this shareholder agrees with the above commitment and wishes to sign this commitment with the founding shareholder; legal representative or authorized representative for a founding shareholder who is an organization, legal representative or authorized representative for another shareholder who is an organization, if this shareholder agrees with the above commitment and wishes to sign this commitment with the founding shareholder.

The Business Registration Office posts the Commitment to implementing social and environmental goals on the National Business Registration Portal when issuing the Certificate Business registration certificate for the enterprise.

– In case the enterprise converts to a social enterprise, the enterprise submits documents to the Business Registration Office where the enterprise is headquartered. The dossier includes the following documents:

+ Commitment to implementing social and environmental goals signed by the legal representative of the enterprise;

+ Resolutions, decisions and copies of meeting minutes of the Board of Members for limited liability companies with two or more members, partnerships, and of the General Meeting of Shareholders for joint stock companies; resolutions and decisions of the company owner for a single-member limited liability company on the approval of the Commitment content.

The Business Registration Department updates information of the enterprise in the National Database on Business Registration and posts the Commitment to implementing social and environmental goals on the National Information Portal on Business Registration within 03 working days from the date of receipt of the application. profile.

– In case the content of the Commitment to implementing social and environmental goals changes, the social enterprise must send a notice to the Business Registration Office where the enterprise is headquartered within 05 working days from the date of decision to change. Accompanying the notice must be the following documents:

+ Commitment to implementing revised and supplemented social and environmental goals signed by the legal representative of the enterprise;

+ Resolutions, decisions and copies of minutes of meetings of the Board of Members for limited liability companies with two or more members, partnerships, of the General Meeting of Shareholders for joint stock companies; resolutions and decisions of the company owner for the single-member limited liability company on approving the changed content of the Commitment.

The Business Registration Department updates information of the enterprise in the National Database on Business Registration and posts the Commitment to implementing social and environmental goals that has been amended and supplemented on the National Information Portal on Business Registration within 03 working days from the date of receipt. be notified.

– In case of termination of the Commitment to implementing social and environmental goals, the social enterprise must send a notice to the Business Registration Office where the enterprise is headquartered within 05 working days from the date of decision to terminate. Accompanying the notice must be the following documents: Resolutions, decisions and copies of meeting minutes of the Board of Members for limited liability companies with two or more members, partnerships, and of the General Meeting of Shareholders for joint stock companies; Resolution or decision of the company owner for a single-member limited liability company or decision of a competent state authority (if any) on the termination of the Commitment, clearly stating the reason for termination.

The Business Registration Department updates information of enterprises in the National Database on Business Registration and posts the documents specified in Clause 4 of this Article on the National Information Portal on Business Registration in a period of 03 working days from the date of receipt of the notice.

– Documents, order and procedures for division, separation, consolidation and merger of social enterprises shall comply with the provisions of this Decree. In case of establishing a new social enterprise on the basis of division, separation or consolidation of enterprises, the application must include a Commitment to implementing social and environmental goals specified in Clause 1 of this Article. In case of division, separation, consolidation or merger of social enterprises leading to the termination of the Commitment to implementing social and environmental goals, the dossier must have additional documents specified in Clause 4 of this Article.

– Documents, order and procedures for dissolution of social enterprises are carried out in accordance with the provisions of this Decree. In case the social enterprise still has a balance of assets or finance for the aid and sponsorship it has received, the dissolution dossier must include a copy of documents on the handling of the balance of assets or finance for the aid and sponsorship the social enterprise has received.

– Registration of establishing a social enterprise on the basis of conversion from a social protection facility, social fund, or charity fund is done at the Business Registration Office where the enterprise is located. the society intends to locate its headquarters. The business registration dossier includes the documents specified in Clause 1 of this Article, which does not include the Investment Registration Certificate specified in Point b Clause 4 Article 22, Point c Clause 4 Article 23, Point c Clause 3 Article 24 of this Decree. Attached to the application must be the following documents:

+ Written decision allowing conversion into a social enterprise by the competent agency that has issued the license to establish a social protection facility, social fund, charity fund;

+ Certificate of establishment registration for social protection facilities, establishment license and recognition of fund charter for social funds, charity funds improvement;

+ Copy of Tax Registration Certificate;

+ Document of the Investment Registration Authority approving the capital contribution, share purchase, purchase of capital contribution of foreign investors, foreign-invested economic organizations in cases where procedures for registration of capital contribution, share purchase, purchase of capital contribution must be carried out according to the provisions of the Law on Investment private.

Within 02 working days from the date of issuance of the Business Registration Certificate, the Business Registration Office sends a copy of the Business Registration Certificate and the original of the Establishment Registration Certificate for social protection establishments, establishment license and recognition of fund charter for social funds and charity funds to the competent authority that has issued the license to establish social protection establishments, social funds and charity funds to terminate operations. activities of social protection establishments, social funds, and charity funds.