What is a sole proprietorship? What is the procedure to establish a sole proprietorship in Vietnam? What should the owner prepare to establish a sole proprietorship the purpose of conducting business?
A sole proprietorship is one of the forms of business stipulated in the Law on Enterprise 2020 and can be understood as an enterprise owned by an individual whose liability for its entire operation is equal to his/her total assets. Each individual can only establish one sole proprietorship. The owner of a sole proprietorship shall neither concurrently own a household business nor hold the position of general partner of a partnership. So, what are the steps to establish a sole proprietorship according to the Law on enterprises 2020?
To establish sole proprietorships, individuals shall prepare a registration application for the establishment of a sole proprietorship and carry out the following procedures:
1. The registration application for the establishment of a sole proprietorship shall include:
- The enterprise registration application form (according to the form in Appendix I-1 attached to Circular No. 01/2021/TT-BKHDT dated March 16, 2021 of the Minister of Planning and Investment).
- Copies of the legal documents of the owner of the sole proprietorship.
- A Power Of Attorney (“POA”) for the submission of the application (provided that the person submitting the registration application is not the owner of the sole proprietorship).
- Copies of the legal documents of the authorized individual.
2. Competent authority: the Business Registration Office under the Department of Planning and Investment.
3. Method of submission:
The owner or the authorized individual shall apply for enterprise registration with the business registration authority as follows:
a) Direct registration with the business registration authority;
b) Registration via post;
c) Online registration.
4. Duration: 03 working days from the date the Business Registration Office receives a valid application.
5. Result: Enterprise Registration Certificate of the sole proprietorship.
After finishing the procedure for the establishment of the sole proprietorship at the Business Registration Office, it is essential for the owner of the sole proprietorship to conduct the other procedures for the sole proprietorship to be officially entered into operation such as:
- Engraving a seal for the sole proprietorship.
- Acquiring the digital signature for the sole proprietorship.
- Carrying out procedures with tax authorities for sole proprietorship’s management.
- Opening a bank account for the sole proprietorship.
- Placing the company sign in its Head Office.
Disclaimer: This article is solely for informational purposes. Its contents shall neither constitute legal advice nor be regarded as detailed written legal advice for individual cases. Should you have inquiries on such matter, please contact us for more information.
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