GUIDE PROCEDURE FOR CORPORATE AMALGAMATION IN VIETNAM

The difference between amalgamation and acquisition is that acquisition ends the existence of the acquired company and remains the existence of the acquirer and corporate amalgamation terminate the existence of all the companies merged. To ensure the consistency of the steps to complete the procedures for the consolidated enterprise, the Enterprise Law 2014 also has specific provisions on this matter, we can divide them into three main steps:

Step 1. Prepare the consolidation contract

The consolidating companies prepare the consolidation contract. The consolidation contract must contain the consolidating companies’ names, headquarter addresses; the consolidated company’s name and headquarter address; procedures and conditions for consolidation; employment plan; time limit and procedures for transferring assets, stakes, shares, bonds of the consolidating companies to the consolidated company; time limit for consolidation; draft charter of the consolidated company.

Consolidation contract is also an objective basis to record the consolidation companies, the rights and obligations of the new company. Since then, the parties after the merger be able to rely on the contract to perform construction and charter companies, conducting business activities of the new company.

Step 2: Announce the consolidation contract

Consolidation contract signed between the enterprise consolidation, should be publicly announced, specifically for all creditors and notified to all employees within 15 days from the ratification date;

When conducting business consolidation, consolidation have a big influence on the interests of creditors or employees of companies. Therefore, the consolidation contract must be sent to these objects as necessary, to ensure their optimal benefits.

Step 3: Complete procedures for business registration or changes of business registration information

Members, the owner, or shareholders of the consolidating companies shall ratify the consolidation contract, the consolidated company’s charter, elect or designate Chairpersons of the Board of members, the company's President, the Board of Directors, Director/General Director of the consolidated company, and apply for business registration in accordance with Law on Enterprise 2014.

At the same time, legal consequences after registering new company, the consolidating companies will cease to exist; consolidated company enjoys the rights and legitimate interests, responsible for unpaid debts, labor contracts and other property obligations of the consolidating company.