Is it mandatory to notify employees when separating a limited liability company with two or more members?

Is separation of a limited liability company with two or more members required to notify employees?

Procedures for separating a limited liability company with two or more members are specified in Clause 3, Article 199 of the 2020 Enterprise Law:

Company separation

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3. Procedures for separating a limited liability company and a joint stock company are prescribed as follows:

a) The Board of members, the company owner or the General Meeting of Shareholders of the separated company shall pass a resolution or decision to separate the company in accordance with the provisions of this Law and the company’s Charter. The resolution and decision to separate the company must include the following main contents: name and head office address of the separated company; Name of the split company to be established; labor use plan; How to separate the company; the value of assets, rights and obligations transferred from the separated company to the separated company; Time limit for separating the company. Resolutions and decisions to separate the company must be sent to all creditors and notified to employees within 15 days from the date of decision or adoption of the resolution;

b) Members, company owners or shareholders of the separated company approve the Charter, elect or appoint the Chairman of the Board of Members, Company President, Board of Directors, Director or General Director and proceed with business registration according to the provisions of this Law.

Thus, according to regulations, in case of separation of a limited liability company with two or more members, the resolution and decision to separate the company must be sent to all creditors and shareholders. notify workers within 15 days from the date of decision or resolution adoption.

How can a limited liability company with two or more members be separated?

The form of separation of a limited liability company with two or more members is specified in Clause 1, Article 199 of the 2020 Enterprise Law as follows:

Company separation

1. A limited liability company or joint stock company can be separated by transferring part of the assets, rights, obligations, members, and shareholders of the existing company (hereinafter referred to as the separated company) to establish one or several new limited liability companies or joint stock companies (hereinafter referred to as the separated company) without terminating the existence of the separated company.

2. The separated company must register a change in charter capital, number of members, shareholders corresponding to the capital contribution, shares and reduced number of members and shareholders (if any); At the same time, business registration for the separated companies.

Thus, according to regulations, a limited liability company with two or more members can be separated by transferring part of the assets, rights, obligations, and members of the existing company to establish one or several limited liability companies without terminating the existence of the separated company.

What is included in the business registration dossier in case of separation of a limited liability company?

Business registration documents are specified in Clause 2, Article 25 of Decree 01/2021/ND-CP as follows:

Business registration documents for companies established on the basis of division, separation, or merger of companies

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2. In case of separation of a limited liability company or joint stock company as prescribed in Article 199 of the Law on Enterprises, in addition to the documents specified in Article 23 and Article 24 of this Decree, the business registration dossier for the separated company must contain the following documents:

a) Resolution and decision on separation of the company according to the provisions of Article 199 of the Law on Enterprises;

b) Copy of the minutes of the meeting of the Board of Members for a limited liability company with two or more members, of the General Meeting of Shareholders for a joint stock company on the separation of the company.

Thus, according to regulations, the business registration dossier in case of separation of a limited liability company includes the following documents:

(1) Documents specified in Article 23 of Decree 01/2021/ND-CP:

– Application for business registration.

– Company charter.

– List of members.

– Copies of the following documents:

+ Personal legal documents for the legal representative of the enterprise;

+ Personal legal documents for company members who are foreign investors and individuals;

Legal documents of the organization for members who are foreign investors being organizations;

Legal documents of the individual for the authorized representative of a member who is a foreign investor who is an organization and the document appointing an authorized representative.

For members that are foreign organizations, copies of the organization’s legal documents must be consularly legalized;

+ Investment registration certificate in case the enterprise is established or participates in the establishment by foreign investors or economic organizations with foreign investment capital.

(2) Resolutions and decisions on separation of the company.

(3) Copy of the minutes of the Board of Members meeting on the separation of the company.