The latest Bankruptcy Rehabilitation Law 142/2025 applies to the following entities:

Identifying the correct subjects to which the Bankruptcy Rehabilitation Act 2025 appliesLaw No. 142/2025/QH15 This is the first and most important step for businesses to proactively protect themselves against financial risks. The new law has expanded and clarified the groups of entities that can participate in the recovery process, while also establishing separate rules for specific industries. This article will provide detailed guidance on the entities regulated by Law 142/2025/QH15 so you can develop an appropriate response plan.

Overview of the scope of the Bankruptcy Recovery Act 2025

The Bankruptcy Recovery Law 2025 is designed to create a safer and more humane legal framework for debt resolution and corporate restructuring in Vietnam. Instead of focusing solely on asset liquidation, Law 142/2025/QH15 opens the door to recovery for entities facing temporary difficulties but still possessing growth potential.

Scope of application as per Article 1 of Law 142/2025/QH15

According to Article 1 of Law No. 142/2025/QH15, this document not only addresses the termination of a legal entity's operations but also covers the entire process from the initial difficulties to its revival. The main amendments you should note include:

• Regulations on the principles, order, and legal procedures for resolving business recovery cases.
• Establish the steps in the bankruptcy declaration procedure for different types of businesses and cooperatives.
• Clearly define the duties and powers of those conducting the procedure, such as the court judge and the receiver.
• The regulations specify the rights and obligations of the directly involved parties, such as creditors, debtors, employees, and shareholders.

The significance of defining the scope of application.

Understanding whether a business falls under the scope of the Bankruptcy Recovery Act 2025 helps business managers identify their legal protections early on. In particular, this provides a basis for requesting the court to apply recovery procedures, preventing creditors from seizing individual assets and thus preserving resources for rebuilding production instead of having to close down completely.

The following groups of businesses and cooperatives are subject to this regulation.

Essentially, Law 142/2025/QH15 applies broadly to most economic organizations with legal personality operating in Vietnam. This ensures fairness and creates opportunities for the revival of all economic sectors.

Types of businesses according to the Enterprise Law

All businesses legally established and operating under Vietnamese law are directly subject to the provisions of this Law. Specific groups include:

• Single-member limited liability companies and limited liability companies with two or more members.
• A joint-stock company with a complex shareholder structure.
• Partnerships and private enterprises as regulated.
• Foreign direct investment (FDI) enterprises are carrying out production and business activities in Vietnam.

Cooperatives and cooperative unions

A key point in Article 1 is the affirmation of equality in legal procedures for collective economic models. The law clearly stipulates that the following entities also fall within its scope of regulation:

• Cooperatives operate in all sectors: agriculture, services, and industry.
• Cooperative unions have a larger scale of management.
• Grouping these groups under the definition of "cooperative" in the Law helps to standardize the processing procedures and avoid overlap between different legal documents.

Exclusions and application of specific laws

Despite its broad scope, the Bankruptcy Recovery Act 2025 still imposes certain limitations to ensure national economic security, particularly for industries with high systemic risk.

The following individuals are not eligible for the simplified recovery procedure:

Pursuant to Article 2 of Law No. 142/2025/QH15, the provisions on recovery procedures and simplified recovery procedures will have significant exceptions. The list of entities to which these provisions apply includes:

• Credit institutions include commercial banks and non-bank financial institutions.
• Insurance companies and reinsurance companies.

To better understand the reasons for this regulation, please refer to the comparison table of the specifics of legal application below:

Excluding financial institutions from the expedited recovery procedure is a necessary step to avoid negative ripple effects on the monetary market. These entities will have a separate recovery mechanism under the close supervision of specialized state regulatory agencies.

Apply relevant laws.

In situations where the Bankruptcy Recovery Law 2025 does not have specific provisions, the prosecuting authorities will invoke relevant legal provisions such as the Civil Code or the Enterprise Law. This ensures that the case resolution process always has a solid legal basis and is not interrupted.

Key changes businesses need to be aware of.

Compared to the old regulations, those subject to the Bankruptcy Recovery Law 2025 need to shift their mindset from "avoiding" to "proactively" using the law as a professional risk management tool.

Priority restoration rights for eligible individuals

All entities falling within the scope of regulation are entitled to the priority recovery principle under Article 3. This is extremely important for business owners:

• You have the right to propose a debt restructuring plan before being declared bankrupt.
• Protected against asset seizure orders from other civil lawsuits during the recovery process.
• There is an opportunity to renegotiate economic contracts and labor relations to reduce the burden of costs.

Legal responsibilities of managers

The scope of application of Law 142/2025/QH15 is not limited to legal entities but also directly affects individual managers. The new law stipulates:

• The legal representative is obligated to file an application to initiate proceedings as soon as signs of insolvency are detected.
• If delays in filing lead to the dissipation of assets or cause further damage to creditors, the manager may be held liable for compensation with personal assets or face severe administrative or criminal penalties.

Conclude

Identifying the correct scope of application of the 2025 Bankruptcy Recovery Law is key for leaders to effectively apply Law No. 142/2025/QH15 to their business practices. Whether you are managing a small private enterprise or a large FDI corporation, understanding these legal rights and limitations will help you be more proactive in protecting your assets.

To gain a deeper understanding of the implementation roadmap and other specific mechanisms, you can refer to the analysis of these topics. New points in the Bankruptcy Recovery Law 2025 which we have done. We wish your business a speedy recovery from its difficulties and a strong breakthrough.

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