Corporate Restructuring Consulting Services

Corporate restructuring consulting services are increasingly becoming a critical need for businesses in Vietnam as they adapt to changes in their development strategies or business models. Restructuring a company is not merely an administrative procedure; it involves numerous legal factors, requiring meticulous and precise preparation. Choosing the right consulting service can save businesses time and ensure a smooth transition. This article provides insights into corporate restructuring and the services offered by Long Phan Consulting Company.

Overview of Regulations on Corporate Restructuring in Vietnam

According to Clause 31, Article 4 of the 2020 Law on Enterprises, “corporate restructuring means the division, split-off, consolidation, merger, or conversion of the enterprise type.”

The Law on Enterprises doesn’t explicitly define “corporate restructuring” but lists the cases considered as such. However, it can be understood as the process of altering a company’s structure and organization to align with its business objectives and directions through the following forms:

• Company Division.
• Company Split-off.
• Company Consolidation.
• Company Merger.
• Conversion of Enterprise Type.

Company Division (Article 198, Law on Enterprises 2020)

• Definition: A Limited Liability Company (LLC) or a Joint Stock Company (JSC) (the “divided company”) divides its assets, rights, obligations, and members/shareholders to establish two or more new companies.
• Process:
  1. The Members’ Council/Owner/General Meeting of Shareholders of the divided company approves the resolution/decision to divide the company.
  2. Members/Owners/Shareholders of the new companies approve the Charter, elect/appoint management positions, and proceed with enterprise registration. The registration dossier must include the resolution/decision to divide the company.
• Responsibilities After Division:
  • The divided company ceases to exist.
  • The new companies are jointly and severally liable for the obligations of the divided company (unless otherwise agreed).
  • The new companies inherit the divided rights, obligations, and legitimate interests.
  • The business registration authority updates the legal status.

Company Split-off (Article 199, Law on Enterprises 2020)

• Definition: Transferring a portion of the assets, rights, obligations, and members/shareholders of an existing company (the “split-off company”) to one or more new LLCs/JSCs (the “spun-off companies”) without terminating the existence of the split-off company.
• Process:
  1. The Members’ Council/Owner/General Meeting of Shareholders of the split-off company approves the resolution/decision to split off the company.
  2. Members/Owners/Shareholders of the spun-off companies approve the Charter, elect/appoint management positions, and proceed with enterprise registration. Note: The split-off company must amend its charter capital registration.
• Responsibilities After Split-off:
  • The split-off company and the spun-off companies are jointly and severally liable (unless otherwise agreed).
  • The spun-off companies inherit the divided rights, obligations, and legitimate interests.

Company Consolidation (Article 200, Law on Enterprises 2020)

• Definition: Two or more companies (the “consolidated companies”) combine to form a new company (the “consolidated company”), simultaneously terminating the existence of the consolidated companies.
• Process:
  1. The consolidated companies prepare a consolidation agreement and a draft Charter for the consolidated company.
  2. Members/Owners/Shareholders of the consolidated companies approve the agreement, Charter, elect/appoint management positions, and proceed with enterprise registration for the consolidated company.
• Important Note (Competition Law): Company consolidation must comply with competition laws to avoid market dominance by the post-consolidation entity. This is a crucial point to emphasize.
• Responsibilities After Consolidation:
  • The consolidated companies cease to exist.
  • The consolidated company enjoys the rights and is responsible for the obligations of the consolidated companies.
  • The consolidated company inherits all rights, obligations, and legitimate interests.
  • The business registration authority updates the legal status.

Company Merger (Article 201, Law on Enterprises 2020)

• Definition: One or more companies (the “merged companies”) transfer all their assets, rights, and obligations to another company (the “acquiring company”), simultaneously terminating the existence of the merged companies.
• Process:
  1. The involved companies prepare a merger agreement and a draft Charter for the acquiring company.
  2. Members/Owners/Shareholders of the involved companies approve the agreement, Charter, and proceed with enterprise registration for the acquiring company.
• Important Note (Competition Law): Similar to consolidation, company mergers must comply with competition laws.
• Responsibilities After Merger:
  • The merged companies cease to exist.
  • The acquiring company enjoys the rights and is responsible for the obligations of the merged companies.
  • The acquiring company inherits all rights, obligations, and legitimate interests.
  • The business registration authority updates the legal status.

Conversion of Enterprise Type (Articles 202, 203, 204, 205, Law on Enterprises 2020)

The 2020 Law on Enterprises regulates the following conversion scenarios:

• Conversion of an LLC to a JSC (Article 202):
  • Without raising additional capital/without selling capital.
  • Raising additional capital.
  • Selling capital.
  • Combining the above methods.
• Conversion of a JSC to a Single-Member LLC (Article 203):
  • One shareholder acquires all shares.
  • An organization/individual who is not a shareholder acquires all shares.
  • Only one shareholder remains.
• Conversion of a JSC to a Multi-Member LLC (Article 204):
  • Without raising/transferring shares.
  • Raising additional capital.
  • Transferring shares.
  • Only two shareholders remaining
  • Combining the above methods.
• Conversion of a Private Enterprise to an LLC, JSC, or Partnership (Article 205): *Meeting the condition to establish enterprises under the law *The private business owner commit personal responsibilities *Agreement with related parties. *Commitment about using labor
• General Process for Conversion:
  1. The company registers the conversion with the Business Registration Authority (within 10 days of completing the conversion).
  2. The Business Registration Authority re-issues the Enterprise Registration Certificate (within 3 working days).
  3. The converted company automatically inherits all rights and obligations.

Why Choose Corporate Restructuring Consulting Services?

The procedures to be carried out after restructuring can sometimes be complicated for some businesses. These may include tax finalization, tax declaration, changes to business registration, changes to seals, etc. At this point, choosing to use corporate restructuring consulting services will help:

• Ensure Legal Compliance: Consulting services help businesses carry out restructuring procedures in accordance with current legal regulations, avoiding unnecessary legal risks.
• Save Time and Costs: Consulting and implementing restructuring procedures will help businesses save time in preparing documents and carrying out procedures, while minimizing costs incurred during the implementation process.
• Provide Optimal Solutions: Consultants will help businesses choose the most suitable form of restructuring for the business’s development goals and needs, thereby offering appropriate strategies.
• Support in Preparing Documents and Legal Procedures: Consulting experts help draft and prepare the necessary documents, thereby minimizing the risk of being rejected or requiring additional information from state agencies.
• Optimize the Process: Consulting services help businesses carry out restructuring in a methodical, reasonable, and fast manner, minimizing disruptions in business operations.
• Advice on Issues Related to Organizational Structure and Personnel: During the restructuring process, consulting services will also assist businesses in adjusting the organizational structure and personnel.
• Post-Restructuring Support: This includes updating legal information, changing business licenses, and resolving any arising legal issues.
• Expertise and Experience: Consulting firms have a team of experienced professionals who are ready to assist and resolve complex legal issues related to business type conversion.

Corporate Restructuring Consulting Services at Long Phan Consulting Company

With a team of experienced consulting experts, we provide reputable and comprehensive corporate restructuring consulting services with the following scope:

• Consulting on conditions and procedures before and after corporate restructuring.
• Consulting on drafting necessary contracts, decisions, resolutions, minutes, etc., during the restructuring process.
• Representing clients in submitting dossiers to competent authorities.
• Assisting in resolving cases where dossiers are invalid or there are arising issues.
• Consulting and supporting personnel restructuring and enterprise structure after corporate restructuring.
• Other issues related to corporate restructuring.

The above is the scope of our comprehensive service. However, depending on the client’s requirements, we can perform one or several stages in the restructuring process. The service fee also depends on the client’s requirements. Therefore, please do not hesitate to contact us for free service consultation.

Fee Schedule for Corporate Restructuring Consulting Services

At Long Phan Consulting Company, we provide comprehensive corporate restructuring consulting services, with flexible fees tailored to each type of enterprise and the specific requirements of the client. We are committed to delivering exceptional value with professional services, ensuring legal compliance, and helping businesses save time and costs during the restructuring process. Accordingly:

• The service fee will be determined based on the complexity of each case and the client’s requirements.
• Long Phan Consulting will provide a detailed and specific quote after discussing and understanding the business’s needs.

Contact Information for Corporate Restructuring Consulting Services

To receive a specific quote or further assistance regarding our services, please contact us through the following methods:

• Hotline: 0906.735.386
• Email: info@longphanpmt.com
• Facebook Fanpage: Công ty TNHH Tư vấn đầu tư và Dịch vụ pháp lý Long Phan
• Zalo: 0906.735.386
• Office Address: TM7 Lot, Lavita Garden Apartment, No. 17, Street No. 3, Truong Tho Ward, Thu Duc City, Ho Chi Minh City.

FAQ about Long Phan Consulting Company’s Corporate Restructuring Services

To provide you with a clearer understanding of our services, below are frequently asked questions and detailed answers to help you address your concerns during the corporate restructuring process.

• Q: What does Long Phan Consulting’s corporate restructuring service include?

  • A: Our service includes advising on corporate restructuring options, drafting necessary legal documents, supporting registration procedures for changes at state agencies, consulting on personnel structure, and addressing legal issues arising after restructuring.

• Q: What is corporate restructuring?

  • A: Corporate restructuring is the process of changing a company’s structure or business model, including forms of division, split-off, consolidation, merger, or conversion of enterprise type.

• Q: Is it mandatory for a business to use corporate restructuring consulting services?

  • A: Using consulting services is not mandatory, but it helps businesses ensure compliance with legal regulations, save time, and avoid errors during the implementation process.

• Q: What types of businesses can use corporate restructuring consulting services?

  • A: Our consulting services can be applied to all types of businesses, including LLCs, JSCs, private enterprises, and partnerships.

• Q: How much does the corporate restructuring consulting service cost?

  • A: The service cost is determined based on the client’s specific requirements and the complexity of the restructuring process. We will provide a detailed quote after understanding the business’s needs and scale.

• Q: How long does the corporate restructuring process take?

  • A: The time required for the corporate restructuring process depends on the form of restructuring and the procedures to be performed. Typically, this process takes from a few weeks to several months.

• Q: Does Long Phan Consulting provide support for legal procedures after corporate restructuring?

  • A: Yes, we not only provide support during the restructuring process but also assist businesses in resolving legal procedures arising after restructuring, such as changing business licenses, updating legal information, and tax reporting.

• Q: Does corporate restructuring affect the company’s existing contracts and commitments?

  • A: Corporate restructuring can affect existing contracts and commitments, so we will advise and assist businesses in adjusting contracts and ensuring the validity of commitments.

Conclusion

Long Phan Consulting Company‘s corporate restructuring services help you carry out corporate restructuring smoothly and in compliance with legal regulations. For detailed advice and timely support or using business registration services, please contact us via hotline 0906735386. We are always ready to accompany businesses in every step of transformation for sustainable development.