Decree No. 01/2021/ND-CP dated January 4, 2021 regulates new ordinance on household businesses

January 4, 2021, the government issued Decree No. 02/2021/ND-CP on business registration (aka Decree 01) to replace Decree No. 78/2015/ND-CP dated September 14, 2015 on business registration and Decree No. 108/2018/ND-CP dated August 23, 2018 of the government on amendment and supplementation of some articles of Decree No. 78/2015/ND-CP dated September 14, 2015 of the government on business registration. Accordingly, the Decree 01 regulates new ordinances including the ordinances of household businesses.

Firstly, only 2 subjects are eligible for establishing household businesses, which are individuals or household members. Therefore, under the new regulations, ‘group of Vietnamese individuals’ are not allowed to establish household businesses. Besides, the Decree 01 added subjects that do not need to register for business on their seasonal business activities.

Secondly, household businesses are allowed to operate in various locations. “A household business can operate at various locations; however, it must choose a location and register it as the office of its household business including the notifications to tax managing agencies and market control agencies in charge of the locations of such household business.”

Thirdly, the Decree regulates term of renewal registration of business registration certificates.

Fourthly, business operations are allowed to be postponed indefinite of time, which was regulated to less than 1 year including written notification to local district’s registry 15 days prior to business operation postponement. Currently, the Decree 01 does not limit the term of business operation postponement but it still requires notifications to local district’s registry 3 days before such postponement.

Fifthly, authorization is allowed for household business registration, which is quoted from the Decree: “Household business owners are allowed to authorize any organization and/or individuals to implement household business registration under Article 12 of the Decree,” which was previously not regulated.

Sixthly, changes and supplementations are made to the cases of retrieval of household business registration certificate. The household business registration certificates are revoked in the following cases:

- The contents declared in household business registration dossiers are fake.

- Business operations are for 6 consecutive months without notifications to local district’s business registry and tax agency.

- Banned business operations and career.

- The household business is established by a illegible individuals.

- The household business has not reported as required to local district’s registry within 3 months of expiry of requirements for reports or written request.

- Other cases that are regulated by the courts or order of competent agencies under legal regulations.

Seventhly, regulations are added against managers of business operations, by which, they may hire others to manage and run their business operations. However, they are responsible for debts and asset obligations incurred by their business operations.

Department of Justice – Translated by Vi Bao