1. Legal context of expanding the authority to terminate the operation of dependent units
In the process of monitoring and advising enterprises on legal changes, DNP Viet Nam Law Firm observes that the regulation on expanding the authority to terminate the operation of branches, representative offices, and business locations is a noteworthy content in the Law amending and supplementing the Law on Enterprises 2025. This regulation is established to enhance the effectiveness of state management over dependent units of enterprises. At the same time, it also contributes to ensuring legal compliance of units operating under the model of branches or business locations.
The legal basis of this regulation is stipulated in Clause 24, Article 1 of the Law amending and supplementing the Law on Enterprises 2025. Accordingly, the scope of authority of state agencies in terminating the operation of branches, representative offices, and business locations is expanded compared to the previous regulations. Instead of only revoking the Certificate of Registration of Operation of dependent units, the regulatory authorities may implement more robust management measures upon detecting violations.
2. New provisions on the authority to terminate the operation of dependent units
Under the new provisions, the entities having authority to decide on the termination of operation of branches, representative offices, and business locations are expanded. This allows state authorities not only to revoke the Certificate of Registration of Operation of dependent units but also to implement measures related to enterprise registration management. The objective of this regulation is to strengthen the ability to control and handle violations of law in business operations.
In addition, the new provisions also change the approach to the “Certificate of Registration of Operation” of dependent units. Previously, the handling mainly stopped at the revocation of the Certificate of Registration of Operation of branches or representative offices. However, under the new provisions, regulatory authorities may apply broader measures to ensure that the termination of operation is carried out thoroughly and in accordance with legal regulations.
3. Significance of the new provisions for enterprise management
The expansion of authority to terminate the operation of branches, representative offices, and business locations helps enhance the effectiveness of state management over the system of dependent units of enterprises. In practice, many branches or business locations no longer operate at their registered addresses but still exist in the enterprise database system. The new provisions allow regulatory authorities to thoroughly handle such cases to ensure the accuracy of business registration information.
Furthermore, the new provisions also contribute to enhancing the legal responsibility of enterprises in managing their dependent units. Enterprises must ensure that branches, representative offices, and business locations operate in accordance with their registered purposes, at the correct addresses, and in full compliance with legal regulations. This not only helps enterprises avoid legal risks but also builds credibility with partners and regulatory authorities.
4. What should enterprises note in managing branches and business locations?
First, enterprises need to strengthen the control and monitoring of the operation of branches, representative offices, and business locations. Periodic inspections will help enterprises promptly detect legal issues such as change of address, suspension of operation, or violations of legal regulations. When there are changes related to dependent units, enterprises must carry out procedures to update information with the business registration authority in a timely manner.
In addition, enterprises should regularly review the legal status of their dependent units to avoid cases where the Certificate of Registration of Operation is revoked by regulatory authorities. Proper and transparent management of legal records will help enterprises demonstrate the lawful operation of branches or business locations when necessary. At the same time, this is also a way for enterprises to minimize potential legal risks arising during operation.
5. Recommendations from DNP Viet Nam Law Firm
From experience in providing legal consultancy to numerous domestic and foreign enterprises, DNP Viet Nam Law Firm recommends that enterprises establish a strict management mechanism for their system of branches, representative offices, and business locations. Periodic review of the operational status and legal compliance of dependent units will help enterprises reduce the risk of having their operation terminated by decisions of regulatory authorities. At the same time, enterprises should promptly update legal changes to ensure that their business operations are always in compliance with current regulations.
In the context where the Law on Enterprises 2025 strengthens management over dependent units, compliance with regulations on termination of operation of branches, representative offices, and business locations becomes particularly important. If enterprises require legal consultancy on branch management, implementation of enterprise registration procedures, or review of legal dossiers, the lawyers of DNP Viet Nam Law Firm are ready to assist. We are committed to providing comprehensive legal solutions to help enterprises operate effectively and fully comply with legal regulations.
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