When Should You Dissolve a Business?

Dissolving a business marks the final stage in its legal lifecycle. Understanding the conditions, procedures, and responsibilities involved ensures compliance with the law while minimizing potential risks. Below are three quiz questions designed to help you master the fundamentals of business dissolution under current regulations.

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Under What Circumstances Can a Business Be Dissolved?

  • A. When the business owner wishes to switch to a new industry
  • B. When the business fails to change its legal form within 6 months of not meeting the minimum number of members or shareholders as required by law
  • C. When the business suspends operations for more than 1 year
  • D. When the business reports losses for 3 consecutive years

According to Article 207 of the 2020 Enterprise Law and Law 76/2025 amending and supplementing certain provisions of the Enterprise Law No. 59/2020, a business is subject to dissolution if it fails to maintain the minimum number of members or shareholders for 6 consecutive months without converting its legal form.

What is One of the Conditions for a Business to Be Dissolved?

  • A. The business has no assets left to pay off debts
  • B. The business no longer has a need to operate
  • C. The business has settled all debts and is not involved in any ongoing court disputes
  • D. The business has achieved sufficient profits and wishes to distribute them entirely to shareholders

A business can only be dissolved after ensuring all debts and other financial obligations are fully paid and it is not involved in any ongoing court or arbitration disputes.

What is the Priority Order for Debt Repayment When Dissolving a Business?

  • A. Tax debts, salary debts, partner debts
  • B. Salary and insurance debts, tax debts, other debts
  • C. Shareholder debts, bank debts, tax debts
  • D. Insurance debts, bank debts, loan interest debts

As stipulated, debts are repaid in the following order: salary and insurance obligations (including severance pay, social insurance, health insurance, and unemployment insurance), followed by tax debts, and then other debts.

Tu Kinh

– 19:28 19/11/2025

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