Chapter IX
DECLARATION OF BANKRUPTCY
Article 105. Declaration of bankruptcy by simplified procedures
1. The People’s Court shall declare the bankruptcy by the simplified procedures if:
a) A written request for the initiation of the bankruptcy process is submitted in accordance with the regulations in Clauses 3, 4 and 5 of this Law but the insolvent entity cannot afford the bankruptcy fee and bankruptcy advance;
b) The insolvent entity cannot afford the bankruptcy cost after the written request for the initiation of bankruptcy process is accepted.
2. If the entity is considered a case prescribed in Clause 1 this Article, the People’s Court shall notify the involve entities that the Court shall use the simplified procedures.
3. The People’s Court shall consider and declare the entity bankrupt regarding any case prescribed in Clause 1 this Article or continue to handle that by using the regular procedures and notify that to the involved entities within 30 days from the day on which the People’s Court give the notification as prescribed in Clause 2 this Article.
4. If the People’s Court declares the entity bankrupt in accordance with the regulations in Point b Clause 1 this Article, the bankruptcy fee and bankruptcy advance shall not be refunded to the applicant.
Article 106. Decisions on declaration of bankruptcy when creditors’ meetings fail
The People’s Court shall issue a Decision to declare the entity bankrupt within 15 days from the receipt of the report on the result of a creditors’ meeting regarding any case prescribed in Clause 3 Article 80, Clause 4 Article 83 and Clause 7 Article 91 of this Law.
Article 107. Decisions on declaration of bankruptcy after issuance of Resolutions of creditors’ meetings
1. The People’s Court shall consider the Decision to declare entity bankrupt within 15 days from the receipt of the Resolution of a creditors’ meeting requesting the declaration of bankruptcy in accordance with the regulations in Point c Clause 1 of this Law.
2. After the creditors’ meeting passes the Resolution, any content of which is applied the plan to resume the business operation, the People’s Court shall issue a Decision to declare the entity bankrupt if:
a) The entity cannot formulate the plan to resume the business operation before the deadline prescribed in Clause 1 Article 87 of this Law;
b) The creditors’ meeting does not agree the plan to resume the business operation of the entity;
c) The entity cannot execute the plan to resume the business operation.
Article 108. Decisions to declare entities bankrupt
1. A Decision to declare any entity bankrupt must include:
a) Date;
b) Name of the People’s Court; full name of the Judge in charge of the implementation of bankruptcy process;
c) Name and address of the entity declared bankrupt;
d) Bases of declaration of bankruptcy;
dd) Stopping the business operation of the entity declared bankrupt; suspension of transactions related to such entity; stopping charging the entity the interest; handling of consequences of suspended transactions; declaration of invalid transactions and handling of consequences of invalid transactions; termination of labor contract signed with the employees, provision of benefits for the employees;
e) Termination of entitlements of the representative of the entity;
g) Asset liquidation and remaining assets of the entity put up for auction;
h) Plan to distribute the assets before and after the entity is declared bankrupt according to the order of asset redistribution prescribed in Article 54 of this Law;
i) Transferring the request for handling of dispute to the People’s Court;
k) Prohibition of holding posts after the entity is declared bankrupt as prescribed in Article 130 of this Law;
l) Handling of other issues under the regulations of the law.
2. Every Decision to declare entities bankrupt shall become effective from the issuance of such Decision.
Article 109. Sending and announcing Decisions to declare entities bankrupt
1. The People’s Court shall make an announcement in accordance with the regulations in Clause 1 Article 43 of this Law and send the copy of the declaration of bankruptcy to the Department of Justice where the People’s Court is located if the Decision to declare the entity bankrupt prohibits the individuals from holding the post, establishing and managing the entity within 10 working days from the issuance of a Decision to declare the entity bankrupt.
2. The People’s Court must send the Decision to declare the entity bankrupt to the business registry to delete the name of the entity from the business registration book within 10 working days from the issuance of such Decision; if the Supreme People’s Court issues a Decision to consider the request and petition as prescribed in Article 113 of this Law, such duration can be extended to 15 days from the day on which the Supreme People’s Court issues the Decision.
Article 110. Financial obligations after Decisions to declare entities bankrupt are issued
1. The Decisions on declaration of bankruptcy prescribed in Articles 105, 106 and 107 of this Law do not exempt any owner of private enterprises, general partner of any partnership from fulfilling the financial obligations to the creditors having not received payments unless the involved entities have other agreement or the law has other regulations.
2. Any financial obligation incurred after any entity is declared bankrupt shall be handled under the regulations of the law on civil execution and other relevant law provisions.
Article 111. Requests for reconsideration of and appeals against Decisions on declaration of bankruptcy
1. Any person that is notified as prescribed in Clause 1 Article 109 of this Law can send a request for reconsideration of and the People’s Procuracy at the same level can appeal against the Decision to declare the entity bankrupt.
2. Each request for consideration and appeal must be made within 15 days from the receipt of the Decision on or valid notification of declaration of bankruptcy.
The People’s Court that has issued the Decision to declare the entity bankrupt must send the dossier on such bankruptcy case attached to the request and appeal to the superior People’s Court for consideration within 03 working days from the receipt of such request and appeal.
Article 112. Handling of requests and appeals against Decisions on declaration of bankruptcy
1. The superior People’s Court shall directly appoint a team including 03 Judges to consider and handle the request and appeal against the Decision to declare the entity bankrupt and send the dossier on the bankruptcy case to the People’s Procuracy at the same level on receiving any dossier on bankruptcy case attached to the request and appeal.
2. The People’s Procuracy at the same level must return the dossier to the People’s Court within 05 working days from the receipt of such dossier from the People’s Court.
3. Within 20 days from the receipt of the dossier on the bankruptcy case attached to the request and appeal, the Judge team must call a meeting and issue:
a) a Decision to refuse the request and appeal and affirm the Decision to declare the entity bankrupt;
b) or a Decision to change the Decision to declare the entity bankrupt;
a) or a Decision to cancel the Decision to declare the entity bankrupt and transfer the dossier to the inferior People’s Court for reconsideration.
4. The People’s Procuracy shall attend the meeting called by the Judge team and the court clerk shall take the minutes of the meeting; the People’s Court shall call the requester and other relevant persons to the meeting to represent their opinions if necessary.
5. The Decision on handling of request and appeal issued by the superior People’s Court shall become effective from its issuance.
Article 113. Consideration of requests and appeals according to special procedures
1. Within 15 days from the day on which the superior People’s Court issue the Decision on handling of request and appeal as prescribed in Article 122 of this Law, if there is any written request for reconsideration of the involve entity, appeal of the Supreme People’s Procuracy or appeal of People’s Court, the Executive judge of the Supreme People’s Court shall reconsider such Decision when:
a) There are serious violations against the law on assets;
b) There are new facts that can change the Decision on declaration of bankruptcy that the People’s Court and involved entities do not know when the People’s Court issues such Decision.
2. The Supreme People’s Court shall request the People’s Court that has issued the Decision on handling of request and appeal as prescribed in Article 112 of this Law to the Supreme People’s Court for consideration regarding any case prescribed in Clause 1 this Article.
3. Within 30 days from the receipt of any request of appeal the Executive judge of the Supreme People’s Court shall issue either:
a) a Decision to refuse the request and appeal and affirm the Decision issued by the inferior People’s Court;
a) or a Decision to cancel the Decision to declare the entity bankrupt issued by the inferior People’s Court, Decision on handling of request for reconsideration and appeal filed by the superior People’s Court and transfer the dossier to the inferior People’s Court for reconsideration.
4. The Decision on handling of request and appeal issued by the Executive judge of the Supreme People’s Court is the final one and becomes effective from its issuance.
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