Decree No. 37/2003/ND-CP dated April 10, 2003 of the Government on sanctioning administrative violations in business registration

DECREE

ON SANCTIONING ADMINISTRATIVE VIOLATIONS IN BUSINESS REGISTRATION

THE GOVERNMENT

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the June 12, 1999 Enterprise Law;

Pursuant to the July 2, 2002 Ordinance on Handling of Administrative Violations;

At the proposal of the Minister of Planning and Investment,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.- Objects and scope of regulation

1. This Decree applies to individuals and organizations that commit acts of administrative violation in business registration, registration of operation of branches and representative offices of enterprises under the Enterprise Law; business registration of individual business households under the Government’s Decree No. 02/2000/ND-CP of February 3, 2000 on business registration.

2. Administrative violations in business registration are acts of violating the State management regulations on business registration, which are not crimes and must, as prescribed by law, be administratively sanctioned, concretely: violations of State management regulations on personal identity of enterprises and individual business households; on declaration of head offices and locations of enterprises and individual business households; on registration for capital contribution to companies; on change of contents of business registration dossiers of enterprises and individual business households; on putting up of signboards; publication on newspapers and financial statements.

Article 2.- Sanctioning principles

1. All administrative violations in business registration must be detected in time and stopped immediately. The sanctioning of administrative violations in business registration must be effected in a quick, fair and thorough manner; all consequences caused by administrative violations must be remedied strictly according to the provisions of law.

2. The sanctioning of administrative violations in business registration must be conducted by competent persons in strict compliance with the provisions of this Decree.

3. An act of administrative violation in business registration shall be administratively sanctioned only once. Organizations and individuals that commit many acts of administrative violation shall be sanctioned for each act.

4. The sanctioning of administrative violations in business registration must be based on the nature and seriousness of violations, personal identity of violators and extenuating as well as aggravating circumstances defined in Articles 8 and 9 of the Ordinance on Handling of Administrative Violations in order to decide on appropriate handling forms and measures.

Article 3.- Statute of limitations for sanctioning

1. The statute of limitations for sanctioning an administrative violation in business registration shall be one year as from the date such administrative violation is committed. Past the above-mentioned time limit, no sanction shall be imposed but the consequence remedies prescribed in this Decree shall still apply.

2. For individuals who have already been sued, prosecuted or got decisions to be brought to trial according to criminal procedures, but later got decisions to suspend the investigation or suspend the cases where acts of violation show signs of administrative violation in business registration, they shall be administratively sanctioned; within three days after issuing the decisions to suspend the investigation or suspend the cases, the decision issuers shall have to send the decisions to the persons competent to sanction administrative violations in business registration; for this case, the statute of limitations for sanctioning administrative violations shall be three months as from the date the persons with sanctioning competence receive the suspension decisions and the violation case dossiers.

3. Within the time limits prescribed in Clauses 1 and 2 of this Article, if the violating individuals or organizations commit new administrative violations in the same field where the violations were previously committed or deliberately shirk or obstruct the sanctioning, the statute of limitations prescribed in Clauses 1 and 2 of this Article shall not apply; the statute of limitations for sanctioning administrative violations in business registration shall be re-calculated from the time the new administrative violations are committed or the time when acts of shirking and/or obstructing the sanctioning terminate.

4. One year after the date of completely serving the sanctioning decisions or the date of expiry of the statute of limitations for executing sanctioning decisions, if the individuals and organizations sanctioned for administrative violations do not relapse into violations, they shall be considered not yet having been sanctioned for administrative violations in business registration.

Chapter II

ACTS OF ADMINISTRATIVE VIOLATION IN BUSINESS REGISTRATION - SANCTIONING FORMS AND LEVELS

Article 4.- Violations of regulations on declaration of personal identity of enterprise founders or managers

1. A fine of between VND 1,000,000 and 5,000,000 shall be imposed for one of the following acts:

a/ Declaring persons who have no right to establish and manage enterprises according to the provisions of Article 9 of the Enterprise Law;

b/ Declaring persons who are not in existence, who are dead or missing;

c/ Impersonating other persons, forging signatures;

d/ Assuming other persons’ names in declaration for enterprise establishment and management;

e/ Making untruthful or inaccurate declaration of personal identity in business registration dossiers.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, individuals and organizations committing administrative violations shall also have to re-compile their business registration dossiers. For cases where enterprises have already been granted business registration certificates, they shall have to register for re-granting thereof.

Article 5.- Violations of regulations on declaration of personal identity of heads of individual business households

1. A fine of between VND 100,000 and 500,000 shall be imposed for one of the following acts:

a/ Declaring persons who have no right to make business registration defined in Article 18 of the Government’s Decree No. 02/2000/ND-CP of February 3, 2000 on business registration;

b/ Declaring persons who are not in existence, who are dead or missing persons;

c/ Impersonating other persons, forging signatures;

d/ Assuming other persons’ names in declaration for business registration;

e/ Making untruthful or inaccurate declaration of personal identity in business registration dossiers.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, individuals committing administrative violations shall also have to re-compile their business registration dossiers. For cases where individuals have already been granted business registration certificates, they shall have to register for re-granting thereof.

Article 6.- Violations of regulations on declaration of enterprise head offices

1. A fine of between VND 1,000,000 and 5,000,000 shall be imposed for one of the following acts:

a/ Declaring head office addresses non-existent on administrative maps; declaring head offices where transactions are not actually conducted;

b/ Declaring addresses of head offices not under declarers’ lawful ownership or use right;

c/ Making untruthful or inaccurate declarations of registered places of permanent residence, current living places or places of temporary residence of enterprise managers.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, individuals and organizations committing administrative violations shall also have to re-compile their business registration dossiers. For cases where enterprises have already been granted business registration certificates, they shall have to register for re-granting thereof.

Article 7.- Violations of regulations on declaration of business locations of individual business households

1. A fine of between VND 100,000 and 500,000 shall be imposed for one of the following acts:

a/ Declaring business locations non-existent on administrative maps; declaring business locations where transactions are not actually conducted;

b/ Declaring business locations not under declarers’ lawful ownership or use right;

c/ Making untruthful or inaccurate declarations of registered places of permanent residence, current living places or places of temporary residence of individuals or representatives of households.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, individuals committing administrative violations shall also have to re-compile their business registration dossiers. For cases where they have already been granted business registration certificates, such individuals shall have to register for re-granting thereof.

Article 8.- Violations of regulations on registration of capital contributions to companies

1. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for one of the following acts:

a/ Declaring capital which is actually unavailable, or declaring a capital amount larger than the actual one.

b/ Failing to grant certificates of reception of contributed capital portions to capital-contributing members;

c/ Failing to make member registers for limited liability companies with two or more members and partnerships; shareholder registers for joint-stock companies.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, individuals and organizations violating the provisions at Point a, Clause 1 of this Article shall also have to contribute capital as already committed; if violating the provisions at Points b and c, Clause 1 of this Article, the companies’ representatives at law shall have to grant capital contribution certificates and make member registers for limited liability companies with two or more members and partnerships; shareholder registers for joint-stock companies.

Article 9.- Violations of regulations on registration of changes in contents of enterprises’ business registration dossiers

1. Caution or a fine of between VND 1,000,000 and 5,000,000 shall be imposed for one of the following acts:

a/ Changing head office addresses; renaming enterprises, branches, representative offices, changing business lines, registered capital; changing managers, representatives at law, members of companies without making registration thereof with the business registry;

b/ Untruthfully registering changed contents with the business registry;

c/ Continuing business activities after having got the notification on temporary operation cessation.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions at Points a and b, Clause 1 of this Article, the enterprises’ representatives at law shall also have to register for re-granting of business registration certificates. For cases prescribed at Point c, Clause 1 of this Article, enterprises shall have to cease their business activities until the end of the operation cessation duration inscribed in the notification to the enterprises.

Article 10.- Violations of regulations on registration of changes in contents of business registration dossiers of individual business households

1. Caution or a fine of between VND 100,000 and 500,000 shall be imposed for one of the following acts:

a/ Changing business locations, renaming business households, changing business lines or representatives of business households without making registration thereof with the business registry;

b/ Untruthfully registering changed contents with the business registry;

c/ Continuing business activities after having got the notification on temporary business cessation.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions at Points a and b, Clause 1 of this Article, the individual business households committing administrative violations shall also have to register for re-granting of business registration certificates. For cases prescribed at Point c, Clause 1 of this Article, individual business households must cease their business activities until the end of the operation cessation duration inscribed in the notification to them.

Article 11.- Violations of regulations on business non-registration

Acts of conducting business without making business registration or continuing business activities after business registration certificates are withdrawn shall be administratively sanctioned according to the provisions of the legislation on handling of administrative violations in the trade field.

Article 12.- Violations of regulations on putting up of signboards

1. Caution or a fine of between VND 1,000,000 and 5,000,000 shall be imposed on acts of failing to put up signboards at head offices of enterprises and offices of branches or representative offices

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions of this Article, the enterprises’ representatives at law shall also have to put up signboards at head offices of enterprises and offices of their branches or representative offices.

3. The putting up of signboards not in compliance with regulations shall be handled according to the provisions of the Government’s Decree on handling of administrative violations in the field of culture and information.

Article 13.- Violations of regulations on publication on newspapers

1. Caution or a fine of between VND 1,000,000 and 5,000,000 shall be imposed for one of the following acts:

a/ Failing to publish on newspapers the contents of the already made business registrations according to the provisions in Clause 1, Article 21 of the Enterprise Law.

b/ Failing to publish on newspapers the contents already registered for change;

c/ Failing to publish on newspapers decisions on dissolution of enterprises.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions in Clause 1 of this Article, the enterprises shall also have to publish information on newspapers according to the provisions of law.

Article 14.- Violations of regulations on submission of financial statements

1. Caution or a fine of between VND 1,000,000 and 5,000,000 shall be imposed on act of failing to submit financial statements as prescribed.

2. Consequence remedies applicable to violation acts prescribed in this Article:

Apart from being sanctioned for their administrative violations according to the provisions in Clause 1 of this Article, the enterprises’ representatives at law shall also have to submit financial statements according to the provisions of law.

Article 15.- Violations of regulations on use of business registration certificates and/or operation registration certificates

Acts of adding, erasing, modifying contents of business registration certificates and/or operation registration certificates; leasing or lending business registration certificates and/or operation registration certificates shall be administratively sanctioned according to the provisions of the legislation on handling of administrative violations in the trade field.

Chapter III

COMPETENCE AND PROCEDURES FOR SANCTIONING ADMINISTRATIVE VIOLATIONS IN BUSINESS REGISTRATION

Article 16.- Competence to sanction administrative violations in business registration

1. Presidents of the People’s Committees of communes, wards or district townships may, within the ambit of their respective powers provided for in Article 28 of the Ordinance on Handling of Administrative Violations, apply the administrative sanctioning forms and consequence remedies prescribed in Articles 5, 7 and 10 of this Decree to handle administrative violations in business registration.

2. Presidents of the People’s Committees of urban districts, rural districts or provincial towns may, within the ambit of their respective powers provided for in Article 29 of the Ordinance on Handling of Administrative Violations, apply the administrative sanctioning forms and consequence remedies prescribed in this Decree to handle administrative violations in business registration.

3. The market management agency may, within the ambit of its powers provided for in Article 37 of the Ordinance on Handling of Administrative Violations, apply the administrative sanctioning forms and consequence remedies prescribed in Articles 6, 7, 9 and 10 of this Decree to handle administrative violations in business registration.

Article 17.- Procedures for sanctioning administrative violations

Procedures for sanctioning administrative violations in business registration shall be carried out in compliance with the provisions in Articles 53, 54, 55, 56, 57, 58, 62, 64, 65, 66, 67 and 68 of the Ordinance on Handling of Administrative Violations.

Chapter IV

COMPLAINTS AND DENUNCIATIONS

Article 18.- Complaints, denunciations and settlement thereof

1. Organizations and individuals sanctioned for administrative violations in business registration or their lawful representatives may lodge complaints about competent persons’ decisions on sanctioning administrative violations.

Procedures for lodging and settling complaints about decisions on sanctioning administrative violations in business registration shall comply with the provisions of the legislation on complaints and denunciations.

Pending the results of complaint settlement by the competent agencies, organizations and individuals sanctioned for administrative violations in business registration shall still have to execute sanctioning decisions.

In cases where they disagree with the complaint settlement, organizations and individuals sanctioned for administrative violations in business registration may initiate lawsuits at administrative courts according to the provisions of law.

2. Citizens may denounce to competent State agencies acts of administrative violation in business registration committed by organizations and individuals according to the provisions of the legislation on complaints and denunciations.

3. Citizens may denounce to competent State agencies illegal acts of persons competent to sanction administrative violations in business registration.

The settlement of denunciations of citizens shall comply with the provisions of the legislation on complaints and denunciations.

Article 19.- Handling of violations

1. Persons competent to sanction administrative violations in business registration, who harass for bribes, tolerate, cover up, fail to sanction or sanction not in a prompt and appropriate manner, impose sanctions beyond their vested competence, shall, depending on the nature and seriousness of their violations, be disciplined or examined for penal liability. If damage is caused, compensations therefor must be made according to the provisions of law.

2. Persons handled for their administrative violations in business registration, who commit acts of obstructing, opposing officials on public duty, delaying or shirking the execution of sanctioning decisions or other violation acts, shall, depending on the nature and seriousness of their violations, be disciplined or examined for penal liability. If damage is caused, compensations therefor must be made according to the provisions of law.

Chapter V

IMPLEMENTATION PROVISIONS

Article 20.- Implementation effect

This Decree takes effect 15 days after its publication in the Official Gazette.

The previous regulations on handling of administrative violations in business registration, which are contrary to this Decree, are all hereby annulled.

Article 21.- Implementation responsibility

The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government and the presidents of the People’s Committees of the provinces and centrally-run cities shall have to implement this Decree.