A group with two subsidiaries in the same sector and location and overlapping back offices can streamline by merging them into one — saving operating costs. But a merger is not "combining the books": it is a corporate reorganization with a strict legal sequence covering the merger contract, creditors, employees, tax and enterprise registration. This checklist follows the statutory order.
How to use: ☐ not done · ☑ done · ⚠ have counsel review.
Contents
- 1. What a merger really is
- 2. The 12-item checklist
- 3. Common traps
- 4. Frequently asked questions
- 5. Language versions
- 6. References
1. What a merger really is
Under Article 201 of the Law on Enterprises 2020: one or more companies (the absorbed companies) transfer all assets, rights, obligations and lawful interests to another company (the surviving company), while the absorbed companies cease to exist. The survivor inherits everything — including unsettled debts and disputes.
The key point: a merger is universal succession — you cannot cherry-pick assets and leave debts behind.
2. The 12-item checklist
Item 1: Internal approval of the merger policy ☐
- What to do: The Members' Council / General Meeting of Shareholders (or owner) of both companies approves the merger policy.
- Why: A merger extinguishes a legal person — it requires the decision of each side's highest competent body.
- How: Prepare a proposal stating reasons, the plan and timeline; collect opinions and issue resolutions in proper charter form.
- Watch out: ⚠ For group subsidiaries, also check the parent's internal approval delegation rules.
Item 2: Legal and financial due diligence ☐
- What to do: Review the absorbed company comprehensively: payables, disputes, change-of-control clauses, tax duties, labour, secured assets.
- Why: The survivor inherits all rights and obligations — including risks not yet visible.
- How: List debts, disputes and material contracts; assess outstanding tax duties; inventory assets.
- Watch out: Pay special attention to guarantees, mortgages and contingent liabilities.
Item 3: Draft the merger contract ☐
- What to do: The two companies sign a merger contract with statutory contents: names and addresses; merger procedures and conditions; employee arrangement plan; timetable and procedures for transferring assets, capital contributions and shares; implementation timeline.
- Why: This is the foundational legal instrument of the whole deal — relied on by the business registration authority and creditors alike.
- How: Signed by the legal representatives of both companies, with asset, debt and labour treatment plans attached.
- Watch out: ⚠ The contract must be approved by each company's competent body before formal signing.
Item 4: Adopt the survivor's charter ☐
- What to do: Build/amend the surviving company's charter for the post-merger reality (new charter capital, ownership structure, management organization).
- Why: Charter capital and members/shareholders change — the old charter no longer reflects reality.
- How: Adopt the amended charter at the same time as the merger contract.
- Watch out: Recompute post-merger ownership ratios precisely — errors here breed internal disputes later.
Item 5: Send the merger contract to creditors; notify employees ☐
- What to do: Send the merger contract to all creditors and notify employees within the statutory period.
- Why: This is a mandatory legal duty under Article 201 — sending the contract to creditors and notifying employees on time is compulsory; addressing creditors' requests is recommended practice to avoid disputes.
- How: Use acknowledged delivery (registered post, acknowledged email); keep a send/receipt log.
- Watch out: ⚠ Creditors may demand payment or security — the law does not bar completing the merger while requests are unaddressed, but resolving legitimate requests beforehand is recommended to avoid disputes stalling the deal. The surviving company automatically inherits all outstanding debts.
Item 6: Handle labour relations ☐
- What to do: Prepare the employee arrangement plan: take-over, reassignment, or lawful termination.
- Why: The absorbed company ceases to exist — its employees' labour contracts must be handled lawfully.
- How: Follow the employee plan in the merger contract; process terminations (severance/redundancy allowances) where applicable; re-sign/amend labour contracts with the survivor.
- Watch out: Taken-over employees' service time is cumulative for benefit calculation — do not "reset" their seniority.
Item 7: Finalize taxes of the absorbed company ☐
- What to do: The absorbed company finalizes taxes up to termination: CIT, VAT, PIT and other duties; pays outstanding taxes.
- Why: Tax duties must be settled before the legal person disappears — the tax authority will not "write them off" once the company is gone on paper.
- How: Prepare finalization reports, file returns, pay shortfalls; obtain tax-clearance confirmation.
- Watch out: ⚠ This is the most commonly missed step and stalls the entire timeline at the last minute. Start it early in parallel.
Item 8: Transfer assets, seals and accounts ☐
- What to do: Prepare handover minutes: assets, files, seals (if any), bank accounts, ongoing contracts, sub-licences.
- Why: Ensures business continuity and complete legal documentation.
- How: Inventory against the books; re-register registrable assets (vehicles, real estate, trademarks); notify counterparties of contract succession.
- Watch out: Sub-licences (if any) need holder-change procedures — they do not transfer automatically with assets.
Item 9: Post-merger enterprise registration ☐
- What to do: The survivor files for changes to enterprise registration (capital increase, member/shareholder changes) and simultaneously terminates the absorbed company.
- Why: Only upon registration does the merger complete legally and become opposable to third parties.
- How: File with the Business Registration Office where the survivor is headquartered, with the merger contract, approval resolutions and amended charter.
- Watch out: Verify the new Enterprise Registration Certificate details immediately upon receipt.
Item 10: Update disclosure duties ☐
- What to do: Update beneficial-owner information (if changed), tax registration and sectoral registrations.
- Why: Post-reorganization, much registered information is stale — update to avoid disclosure breaches.
- How: Review all registrations: tax, insurance, labour, IP.
- Watch out: Beneficial-owner declaration duty (Law 76/2025/QH15) — update within 10 working days of changes (see T-155).
Item 11: Notify partners and banks ☐
- What to do: Notify in writing all counterparties, banks and suppliers of the merger and the new contact points.
- Why: Avoids payment and delivery disruption; ensures parties know the succeeding entity.
- Watch out: Contracts with change-of-control clauses need prior counterparty consent — screen from Item 2.
Item 12: Archive the merger file ☐
- What to do: Systematically archive the full file: resolutions, merger contract, handover minutes, tax clearance, new licences.
- Why: Serves audits, tax inspections and post-merger dispute resolution (limitation periods can run for years).
- Watch out: The defunct entity's files must be kept for the statutory retention period — do not destroy them with the old seal.
3. Common traps
- Forgetting the absorbed company's tax finalization — stalls everything at the finish line.
- Incomplete creditor notification — creditors sue and the deal freezes.
- Cherry-picking assets over debts — merger means universal succession; debt filtering is impossible.
- Missing sub-licences — post-merger operations may become "unlicensed" in regulated segments.
- Not updating beneficial owners — breaches the disclosure duty in force since 01/07/2025.
4. Frequently asked questions
Must the merged company finalize its taxes? Yes. The absorbed company must finalize CIT, VAT, PIT and other duties up to termination and settle outstanding taxes before completing enterprise registration.
Can creditors object to the merger? No — the law does not give creditors a right to block the merger. The mandatory duty under Article 201 of the Enterprise Law 2020 is to send the merger contract to all creditors and notify employees within 15 days of approval; the surviving company automatically inherits all outstanding debts. Addressing creditors' legitimate requests before completion is, however, recommended practice to avoid disputes stalling the deal.
How does merger differ from division or split? Merger: the absorbed company transfers everything to the survivor and ceases to exist. Division/split: assets are divided to form new companies; the old company may survive (split-off) or cease (division).
5. Language versions
6. References
- Law on Enterprises 2020 (No. 59/2020/QH14), Article 201 — Merger of enterprises; amended by Law No. 76/2025/QH15 (effective 01/07/2025).
- Content cross-checked via thuvienphapluat.vn at the time of writing (28/9/2026).
