Contents
I. What are capital contribution and charter capital?
According to the provisions of Clause 18, Article 3 of the Enterprise Law 2020, capital contribution is:
“Capital contribution” means the contribution of capital as charter capital to establish a new company or contribution of additional capital to an existing company.
According to the provisions of Clause 34, Article 4 of the Enterprise Law 2020, the charter capital is:
“Charter capital” means the total value of assets that have been contributed or promised by the members/partners/owners when the limited liability company or partnership is established; or the total of nominal values of the sold or subscribed shares when a joint stock company is established.
II. Time limit for capital contribution
In Clause 2.3, Article 75 of the Enterprise Law 2020, the time limit for capital contribution is prescribed as follows:
– The owner shall contribute adequate and correct assets as promised when applying for enterprise registration within 90 days from the issuance date of the Certificate of Enterprise Registration. The time needed to transport or import the contributed assets and for completing ownership transfer procedures will be added to this 90-day period. During this period, the owner shall have rights and obligations that are proportional to the promised capital.
– In the charter capital is not fully contributed by the deadline specified in Clause 2 of this Article, the owner shall register the contributed capital as charter capital within 30 days from the deadline, in which case the owner shall be responsible for the financial obligations incurred by the company during the period before the change in charter capital is registered in proportion to the promised capital.
If, after the prescribed time limit, the committed capital is still not fully contributed, it must register for an adjustment, the charter capital is equal to the contributed capital within 30 days from the last day to fully contribute the contributed capital.
III. How to handle not enough capital contribution within the prescribed time limit?
If the capital contribution is not enough within the prescribed time limit, the investor or enterprise must register for an adjustment, the charter capital is equal to the contributed capital within 30 days from the last day on which the full capital contribution must be made. capital contribution.
According to the provisions of Article 46 of Decree 122/2021/ND-CP, the sanctioning of violations on business establishment is as follows:
1. A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed for failing to ensure the number of members and shareholders as prescribed.
2. A fine ranging from VND 20,000,000 to VND 30,000,000 shall be imposed for:
a) failure to contribute capital for enterprise establishment or register capital contribution or purchase of shares/stakes of another business organization in the correct form prescribed by law; or
b) upon any entity that does not have the right to contribute capital or purchase shares/stakes but still does so.
3. A fine ranging from VND 30,000,000 to VND 50,000,000 shall be imposed for any of the following violations:
a) Failure to follow procedures for changing capital or changing members or founding shareholders as prescribed at the business registration authority upon expiry of the time limit for capital contribution and time limit for capital change because members or founding shareholders fail to fully contribute capital but there is not any member or founding shareholder that undertakes to contribute capital;
b) Deliberate contribution of assets with false value.
4. A fine ranging from VND 50,000,000 to VND 100,000,000 shall be imposed for any of the following violations:
a) Doing business as an enterprise without applying for enterprise registration;
b) Carrying on business operation after the enterprise registration certificate has been revoked or while the enterprise is requested by a competent authority to suspend or terminate its business operation.
In case there is a violation of the tax law, it shall be handled according to regulations on sanctioning of administrative violations in the tax field.
5. Remedial measures:
The violator is compelled to:
a) change members contributing capital or purchasing shares/stakes if the violation specified in Point b Clause 2 of this Article is committed;
b) follow procedures for changing capital or members or founding shareholders if the violation specified in Point a Clause 3 of this Article is committed;
c) apply for enterprise registration if the violation specified in Point a Clause 4 of this Article is committed.
Therefore, after the prescribed time limit, if the company has not contributed or has not fully contributed the committed capital, the company will be sanctioned according to the provisions of Clause 3, Article 46 of Decree 122/2021 ND-CP.
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