From July 21, 2026: Businesses Failing to Declare Beneficial Owners Face Fines of Up to VND 100 Million

30-07-26 MTParners

Decree 288/2026/ND-CP tightens corporate transparency obligations and extends responsibility to enterprises established before July 1, 2025.

The Government has issued Decree No. 288/2026/ND-CP dated July 21, 2026, amending and supplementing Decree No. 122/2021/ND-CP on administrative sanctions in the field of planning and investment. The Decree took effect on the date of signing, raising the maximum fine to VND 100 million for failing to declare, or inaccurately declaring, beneficial ownership (BO) information — a new obligation arising from the amended 2025 Law on Enterprises (Law No. 76/2025/QH15). Notably, the Decree also imposes a duty on enterprises established before July 1, 2025 to supplement their BO information.

Four Groups of Violations Now Subject to Stricter Penalties

Decree 288/2026/ND-CP amends a series of provisions in Decree 122/2021/ND-CP, both raising fine levels and expanding the scope of sanctioned conduct, with a clear focus on the obligation to declare beneficial owners — individuals who actually own or control an enterprise even though they are not named on its legal documents.

First, amended Article 43 imposes fines of VND 30–70 million for dishonest or inaccurate declarations in applications for enterprise establishment, changes to enterprise registration content, dissolution dossiers, as well as beneficial ownership information contained in such dossiers.

Second, newly added provisions under Article 46 impose fines of VND 50–100 million for failing to declare beneficial ownership information (if any) at the time of enterprise establishment registration — the highest fine level among the new provisions.

Third, Article 48 imposes fines of VND 50–70 million for failing to report or provide, or for reporting or providing dishonest or inaccurate, beneficial ownership information upon request of a competent state authority.

Fourth, Article 52 adds failure to retain enterprise documents (including the list of beneficial owners) and failure to notify the business registration authority and tax authority after one year of business suspension to the general penalty framework, while raising the fine bracket from VND 30–50 million to VND 40–70 million.

“Older” Enterprises Are Not Exempt Either

Notably, Decree 288/2026/ND-CP does not apply only to newly established enterprises. Under the amended provisions on registration of changes to the Enterprise Registration Certificate, enterprises established before July 1, 2025 that have not yet supplemented their beneficial ownership information at their most recent enterprise registration change filing may be fined VND 70–100 million.

In effect, this provision retroactively extends the beneficial ownership transparency obligation — only formally codified into law as of July 1, 2025 — to the entire population of operating enterprises, regardless of their establishment date.

Unreported Business Suspension — Fines Increase by Nearly Half

In addition to the beneficial ownership provisions, Decree 288/2026/ND-CP also raises the fine for enterprises that suspend business operations for one year without notifying the business registration authority and the tax authority, from VND 30–50 million to VND 40–70 million. This is a fairly common occurrence in practice, as many enterprises cease operating in fact without completing the required procedures for business suspension or dissolution.

Practical Impact

With fines of up to VND 100 million for a single violation, compliance costs will rise significantly for enterprises — particularly those with complex, multi-layered ownership structures or foreign elements — that fail to review and timely update their beneficial ownership records. Enterprises established before July 1, 2025 face even greater exposure, as many are not yet fully aware of the new obligation to supplement this information. In addition, the stricter penalties for unreported business suspension serve as a warning to enterprises that leave their tax codes and business licenses “dormant” without formally resolving their legal status.

Recommendations

Enterprises should proactively review their ownership structures to accurately identify beneficial owners under the criteria set out in current law, and prepare and retain a List of Beneficial Owners in the prescribed form (Form No. 10, Appendix I of Circular 68/2025/TT-BTC). Enterprises established before July 1, 2025 should pay particular attention to supplementing this information at their next registration change filing to avoid the VND 70–100 million fine bracket. Enterprises that have ceased operating in practice should promptly complete the procedures for business suspension or dissolution as required by law, rather than allowing their legal status to remain unresolved for more than one year.

MT & Partners Law Firm, with a team of experienced lawyers in corporate legal practice, is ready to assist enterprises in reviewing and declaring beneficial ownership information and updating their business registration records in compliance with the law, minimizing the risk of administrative penalties. Contact hotline 0987140772 or email info@mtpartners.vn for consultation.

(*) This article is for reference only and does not replace specific legal advice.

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