Short answer: A company that ceases business operations for 01 year without notifying the business registration authority and the tax authority will have its Enterprise Registration Certificate (ERC) revoked — point c, clause 1, Article 212 of the Enterprise Law 59/2020/QH14. To be clear from the outset: the law does not use the word “license” here. The document revoked is the ERC — the legal “birth certificate” of the enterprise — not a sub-license or a conditional business line permit. This article uses “license” in the colloquial sense familiar to business owners, but every legal analysis below is anchored on the ERC.
1. How long dormant before revocation? — the 01-year threshold
Point c, clause 1, Article 212 of the Enterprise Law provides that an enterprise ceasing business operations for 01 year without notifying the business registration authority and the tax authority shall have its ERC revoked. This is one of five revocation grounds; the other four are: falsified registration dossiers; founders subject to enterprise-establishment prohibitions; failure to submit statutory reports for over 06 months; and court decisions or requests from competent authorities (points a, b, d, dd, clause 1, Article 212).
Two points to note about the 01-year threshold:
- The condition is “without notifying”. A company that has properly notified suspension of operations does not fall under this ground — “notified suspension” is a lawful status, while “abandoning” the company without notice is the violation.
- The law does not define in detail how the 01-year period is calculated (from which moment, based on which indicators). In practice, authorities typically rely on signs such as no business activity, no tax filings or reports, and no operations at the registered address. Do not assume “it has not been a full year yet, so we are safe” — the safest approach is always to notify suspension as soon as the company stops operating.
2. Freezing the company lawfully: mandatory suspension notice
Article 206.1 of the Enterprise Law requires enterprises to notify the business registration authority in writing no later than 03 working days before suspending operations (or resuming operations ahead of the notified schedule). The notification procedure is set out in Article 60 of Decree 168/2025/ND-CP (effective 01/7/2025, replacing Decree 01/2021/ND-CP):
- The dossier comprises the suspension/resumption notice plus the resolution or decision of the owner, the Members Council or the Board of Directors, depending on enterprise type;
- File with the provincial-level business registration authority where the enterprise is headquartered;
- Each suspension period must not exceed 12 months;
- The authority issues a confirmation within 01 working day of receiving a complete, valid dossier.
During suspension, the enterprise must still fulfil its obligations: tax payments, social insurance, debt settlement, and performance of signed contracts with customers and employees (unless otherwise agreed) — Article 206.3. “Freezing” does not mean forgetting all obligations.
3. New traps from 23/7/2026: the 24-month cap and confirmation duty
Decree 296/2026/ND-CP (effective 23/7/2026, amending Decree 168/2025/ND-CP) has tightened the business-suspension regime — a point many long-suspended enterprises may fall foul of unknowingly:
- Total consecutive suspension must not exceed 24 months. Indefinite rolling renewals are no longer possible.
- Within 05 working days after the suspension expires, the legal representative must confirm resumption of operations on the system. Failure to confirm leads to the authority requesting a report — 06 months without reporting leads to ERC revocation and forced dissolution.
- The 24-month cap also applies to enterprises already suspended before 23/7/2026 (transitional provisions).
A note on citations: the specific article numbers of Decree 296/2026/ND-CP are being cross-checked against the original text; this article cites only the decree name and the substance already agreed by two independent research teams, without article numbers until verification is complete.
4. Signs your company is on the radar
Under Official Telegram 18/CD-CT dated 13/7/2026 of the Tax Department, tax authorities are running a “tax code clean-up” campaign: screening enterprises that are not operating at their registered address and have tax debts — about 325,500 enterprises fall in this group — and proposing revocation under the procedure in Article 69.3 of Decree 168/2025/ND-CP. Two red flags to self-check immediately:
- The company no longer operates (office, signboard, staff) at the address on its ERC;
- It has outstanding tax or social insurance debts, or has not filed tax returns or financial statements for an extended period.
If your company ticks both boxes, receiving a notice requesting explanations is highly likely.
5. Received a notice requesting explanations: what to do
The revocation procedure for ceasing operations for 01 year without notice is set out in Article 69.3 of Decree 168/2025/ND-CP: the authority notifies the violation, requests the enterprise to come and explain, and if the enterprise fails to appear after the explanation deadline or its explanations are not accepted, issues the revocation decision within 03 working days.
Action checklist upon receiving the notice:
- Appear for explanations within the deadline stated in the notice — the document may not specify a fixed number of days, so the deadline in the notice is the only basis; do not guess;
- Prepare supporting documents: suspension confirmation (if any), tax filings, financial statements, premises lease contracts, utility bills — anything proving the company still exists and operates or has lawfully suspended;
- If the company genuinely wants to continue: file the required notice immediately and remedy outstanding obligations;
- If there is no longer any business need: consider voluntary dissolution instead of waiting for revocation — voluntary dissolution leaves a far cleaner legal record.
6. Three tiers of sanctions: fine, revocation, forced dissolution
An “abandoned” company faces an escalating chain of sanctions:
- Tier 1 — administrative fine: failure to notify, or late notification, of suspension/resumption of operations is fined VND 10–15 million for organizations, with a remedial order to complete the notification (point c clause 1 and point c clause 2, Article 50, Decree 122/2021/ND-CP);
- Tier 2 — ERC revocation: under point c clause 1 Article 212 of the Enterprise Law and the procedure in Article 69.3 of Decree 168/2025/ND-CP;
- Tier 3 — forced dissolution: an enterprise whose ERC is revoked falls under mandatory dissolution pursuant to point d clause 1 Article 207 of the Enterprise Law.
By comparison: voluntary dissolution is decided by the owner, with controllable timing and settlement order; revocation followed by forced dissolution is compulsory, and the legal representative may face difficulties establishing or managing other enterprises afterwards. For the same company with no further business need, voluntary dissolution is always the cheaper and cleaner option.
FAQs
Our company has had no business for 8 months and has not notified suspension — will it be revoked immediately?
It has not yet reached the 01-year threshold under point c clause 1 Article 212, but this is the moment to act: file the suspension notice (no later than 03 working days before suspending) to put the company in a lawful status. Do not wait for the full year.
Can a 12-month suspension be renewed?
Yes, each period not exceeding 12 months — but total consecutive suspension must not exceed 24 months under Decree 296/2026/ND-CP (effective 23/7/2026). After 24 months, if you still do not wish to resume, consider alternatives such as dissolution.
What about business households that stop operating?
The threshold differs: a business household ceasing operations for over 06 consecutive months without notice may have its household registration certificate revoked (Article 105 of Decree 168/2025/ND-CP). This article focuses on companies/enterprises, so this is mentioned only for distinction.
After ERC revocation, can it be “reinstated”?
The mechanism for cancelling a revocation decision or restoring an ERC currently lacks a confirmed legal basis; in practice, after revocation the enterprise enters compulsory dissolution. Prevention is therefore always cheaper than cure.
Can a company with tax debts dissolve voluntarily?
Tax obligations and other debts must be settled before dissolution is completed. The relationship between ERC revocation and outstanding tax debts falls under tax law — work with the tax authority to finalize the debt figure before deciding between dissolution and continuation.
Legal sources
- Enterprise Law 59/2020/QH14 (effective 01/01/2021): point c clause 1 Article 212 (ceasing operations 01 year without notice leads to ERC revocation); points a, b, d, dd clause 1 Article 212 (four other revocation grounds); Article 206.1 (suspension notice no later than 03 working days); Article 206.3 (obligations during suspension); point d clause 1 Article 207 (revoked ERC leads to dissolution).
- Decree 168/2025/ND-CP on enterprise registration (effective 01/7/2025, replacing Decree 01/2021/ND-CP): Article 60 (suspension/resumption notification procedure); Article 69.3 (revocation procedure for 01-year unnotified cessation).
- Decree 296/2026/ND-CP amending Decree 168/2025/ND-CP (effective 23/7/2026): 24-month consecutive suspension cap; confirmation of resumption within 05 working days; 06 months without reporting leads to revocation and forced dissolution (article numbers being cross-checked against the original text).
- Decree 122/2021/ND-CP on administrative sanctions in planning and investment: point c clause 1 and point c clause 2 Article 50 (VND 10–15 million fine for organizations failing to notify or late-notifying suspension/resumption).
- Official Telegram 18/CD-CT dated 13/7/2026 of the Tax Department: “tax code clean-up” campaign targeting enterprises not operating at their registered address with tax debts.
Is your company currently suspended, no longer operating at its registered address, or has it just received a notice requesting explanations from the business registration authority? Reach us via the Contact page of FLAT Law Firm for a legal-status review and compliant handling.
The legal content of this article is reviewed by FLAT’s AI Legal Council and submitted to the owner for approval; it is not an opinion of a licensed lawyer and does not replace legal advice for specific cases.
For reference only, not legal advice.