1. In which cases is a Branch of a foreign company in Vietnam terminated?

Pursuant to Article 35 of Decree No. 07/2016/ND-CP, a Branch of a foreign trader (company) in Vietnam shall be terminated in the following cases:

a. Termination at the request of the foreign trader

The parent company abroad has the right to proactively decide to terminate the operation of its Branch in Vietnam in the following circumstances:

• Change in business strategy;
• No longer having demand to operate in the Vietnamese market;
• Restructuring of its commercial presence model.

b. Termination upon cessation of the foreign trader’s operation

Where the foreign parent company ceases its operation in accordance with the laws of the country or territory where it is established or registered, the Branch in Vietnam must also terminate its operation.

c. Termination due to expiry of operation term

Where the Establishment License of the Branch expires and the foreign trader does not carry out renewal procedures in accordance with regulations or is not approved for renewal by the licensing authority.

d. Termination due to revocation of the Establishment License

The Branch shall be terminated upon revocation of its License in cases such as:

• Failure to operate for 01 year and having no transactions with the licensing authority;
• Failure to submit operational reports for 02 consecutive years;
• Failure to submit reports as prescribed under Clause 2, Article 32 of Decree 07/2016/ND-CP within 06 months from the reporting deadline or upon written request;
• Other cases as prescribed by law.

e. Termination due to failure to meet required conditions

The Branch shall be terminated if it no longer satisfies the conditions stipulated in Article 8 of Decree 07/2016/ND-CP, including:

• The foreign trader is established and registered in accordance with the laws of a country or territory participating in international treaties to which Vietnam is a member, or is recognized by such countries or territories;
• The foreign trader has been in operation for at least 05 years from the date of establishment or registration;
• Where the business registration certificate or equivalent document of the foreign trader specifies an operation term, such term must remain valid for at least 01 year from the date of application submission;
• The scope of activities of the Branch must be consistent with Vietnam’s market access commitments under international treaties and the business lines of the foreign trader;
• In cases where the Branch’s scope of activities is inconsistent with Vietnam’s commitments or the foreign trader is not from a country or territory participating in such treaties, approval from the relevant Minister is required.

2. What obligations does a Branch have upon termination?

Termination of operation does not immediately extinguish legal obligations already incurred. The Branch is required to fulfill the following obligations:

a. Obligation to carry out termination procedures

The Branch must complete termination procedures in accordance with Articles 36 and 37 of Decree 07/2016/ND-CP as detailed in Sections 3 and 4 below.

Additionally, the Branch must publicly post the termination notice at its head office and fulfill other legal obligations upon termination.

b. Tax and financial obligations

• Finalize tax obligations with the managing tax authority;
• Fully pay outstanding taxes and penalties (if any);
• Close the Branch’s tax code in accordance with regulations.

c. Obligations toward employees

• Terminate labor contracts;
• Fully settle salaries, allowances, social insurance, and health insurance (if any);
• Complete procedures for termination of work permits and temporary residence cards of foreign employees.

d. Obligations relating to contracts and assets

• Liquidate contracts signed with partners and clients;
• Handle assets and liabilities in accordance with the law.

e. Other administrative obligations

• Close the Branch’s bank accounts;
• Return the seal (if any).

3. Which authority has jurisdiction over termination?

Pursuant to Article 6 of Decree 07/2016/ND-CP and Article 35 of Decree 146/2025/ND-CP, the competent authority to process the termination of a Branch is the authority that issued the Establishment License.

Accordingly, the Provincial People’s Committee (with the Department of Industry and Trade being the authorized body) has the authority to handle the termination.

4. What documents are required for termination?

The termination dossier includes:

1. Notice of termination of Branch operation in the prescribed form issued by the Ministry of Industry and Trade, signed by the authorized representative of the foreign trader
   (except in cases of termination due to license revocation)
2. Copy of the document from the licensing authority refusing renewal of the Establishment License (in case of expiry), or copy of the Decision on revocation of the Establishment License (in case of revocation)
3. List of creditors and outstanding debts, including tax and social insurance liabilities
4. List of employees and their current entitlements
5. Original Establishment License of the Branch

Note: The foreign trader and the Head of the Branch shall be jointly responsible for the truthfulness and accuracy of the dossier.

5. What is the procedure for termination?

Step 1: Submission of dossier

The foreign company submits the termination dossier directly, by post, or online (if applicable) to the licensing authority (as mentioned in Section 3).

Step 2: Receipt and review

Within 03 working days from receipt of the dossier, the licensing authority shall review and request supplementation if the dossier is incomplete or invalid. Such request shall be made only once during the processing.

Step 3: Approval

Within 05 working days from receipt of a complete and valid dossier, the licensing authority shall publish the termination of the Branch on its official website.

6. Related articles

(1) Establishment of a Branch of a Foreign Company in Vietnam
Link: https://phong-partners.com/thanh-lap-chi-nhanh-cua-cong-ty-nuoc-ngoai-tai-viet-nam

(2) Establishment of a Representative Office in Vietnam
Link: https://phong-partners.com/thanh-lap-van-phong-dai-dien-tai-viet-nam