Changing Company Types in Vietnam

During these difficult economic times due to covid 19. It is a real challenge for a business to survive and grow. It can be seen that the number of enterprises suspending and dissolving is constantly increasing. Besides the solution to suspend or dissolve the company. Another option chosen by many businesses is changing the type of company. This action is responsive and appropriate to the ability and development situation of the company. It has helped many businesses overcome the crisis. 

Noticing the need for Changing Company Types in Vietnam, in this post, Warren B would like to provide more information so that our viewers can have a closer look into this matter.

What is Changing Company Types in Vietnam?

Changing the type of company in Vietnam is a form of reorganization and restructuring of an enterprise without having to completely terminate its operations. In other words, that company will operate as a different type of business. Enterprises are not allowed to change on their own, but must fully satisfy all the conditions prescribed by the law on enterprises establishment to have the right to change the type of company. But still, inherit all legal rights and interests, and be responsible for the debts (funds), including tax debts, labor contracts, and other obligations of the converted company.

Enterprises can convert from a limited liability company to a joint stock company, and from a joint stock company to a one-member limited liability company, or two or more members, from a private enterprise to a limited liability company. .. ensure the conditions as well as the provisions of the law.

Changing the type of company will help businesses increase business efficiency, professionalize management, and at the same time solve legal difficulties, in accordance with the size, development, and business orientation of that enterprise. On the other hand, the transformation of the enterprise type helps the enterprise not to be dissolved if the minimum number of members prescribed by law is not met.

Conversion of a limited liability company into a joint stock company in Vietnam

1. The conversion of a state-owned enterprise into a joint stock company shall comply with relevant laws.

2. A limited liability company can be converted into a joint stock company:

a) Without raising additional capital from other organizations and individuals or selling stakes;
b) By raising additional capital from other organizations and individuals;
c) By selling all or part of the stakes to one or some organizations and individuals; or
d) Combining the methods specified in Points a, b and c of this Clause and other methods.

3. The conversion shall be registered with the business registration authority within 10 days from the day on which the conversion is complete. Within 03 working days from the receipt of the application for conversion, the business registration authority shall reissue the Certificate of Enterprise Registration and update the company’s status to the national enterprise registration database.

4. The joint stock company obviously inherits all lawful rights and interests, debts including tax debts, employment contract and other obligations of the limited liability company.

Conversion of a joint stock company into a single-member limited liability company in Vietnam

1. A joint stock company can be converted into a single-member limited liability company as follows:

a) A shareholder receives all shares of the other shareholders;
b) A organization or individual other than a shareholder receives all shares of all shareholders;
c) Only 01 shareholder remains in the company.

2. The transfer or receipt of shares specified in Clause 1 of this Article shall be made at market value or a value determined by asset-based method or discounted cash flow method or another method.

3. Within 15 days from the occurrence of any of the events specified in Clause 1 of this Article, an application for conversion shall be submitted to the business registration authority where the enterprise is registered. Within 03 working days from the receipt of the application, the business registration authority shall issue the Certificate of Enterprise Registration and update the company’s status to the national enterprise registration database.

4. The limited liability company obviously inherits all lawful rights and interests, debts including tax debts, employment contract and other obligations of the joint stock company.

Conversion of a joint stock company into a multiple-member limited liability company in Vietnam

1. A joint stock company can be converted into a multiple-member limited liability:

a) Without raising additional capital or selling stakes;
b) By raising additional capital from other organizations and individuals;
c) By transfer all or part of the shares to other organizations and individuals;
d) When only 02 shareholders remain in the company;
e) Combining the methods specified in Points a, b and c of this Clause and other methods.

2. The conversion shall be registered with the business registration authority within 10 days from the day on which the conversion is complete. Within 03 working days from the receipt of the application for conversion, the business registration authority shall issue the Certificate of Enterprise Registration and update the company’s status to the national enterprise registration database.

3. The limited liability company obviously inherits all lawful rights and interests, debts including tax debts, employment contract and other obligations of the joint stock company.

Conversion of a sole proprietorship into a limited liability company, partnership or joint stock company in Vietnam

1. The owner of a sole proprietorship may convert it into a limited liability company, joint stock company or partnership if the following conditions are fully satisfied:

a) The sole proprietorship satisfies the conditions specified in Clause 1 Article 27 of Law on enterprises 2020;
b) The owner makes a written commitment to take personal responsibility for all unpaid debts and pay them when they are due with all of his/her assets;
c) The owner has a written agreement with the parties of ongoing contracts that the new company will take over and continue executing these contracts.
d) The owner has a written commitment or agreement with other limited partners to continue hiring the existing employees of the sole proprietorship.

2. Within 03 working days from the receipt of the application, the business registration authority shall consider issuing the Certificate of Enterprise Registration if the conditions specified in Clause 1 of this Article are fully satisfied and update the enterprise’s status to the national enterprise registration database.

3. The new company obviously inherits all rights and obligations of the sole proprietorship from the issuance date of the Certificate of Enterprise Registration. The owner of the sole proprietorship shall be personally responsible for all debts that are incurred before this day with all of his/her assets.


That is the information about changing the type of company in Vietnam Warren B would like to introduce to customers. If customers have any questions, please contact Warren B for more consultancy. We hope that the information is useful for investors who are doing or are planning to do business in Vietnam

Warren B – One-stop shop for business in Vietnam.

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