How To Register A Vietnam Company | Step By Step Guides

Issues you care?

☑ What is the yearly tax rate? The rate of income tax on your business be?
☑ There is a special certificate for your next business license company?
☑ Not how long it takes to complete the licensing company?
☑ Is there any legal requirements of Vietnam in ownership of your company?
☑ How to transfer money abroad from Vietnam? How much is the fee and how it works according to the laws of Vietnam?
☑ As with any investment incentives for your business?
☑ How do we take care of the financial statements monthly and yearly?
☑ How to Vietnam laws work in any trade dispute?

→ Structure & Positions

1. Structure

Companies can take one of two basic forms in Vietnam:

• Limited Liability Company ("LLC"), and

• Joint Stock Company ("JSC")

LLC's are the most common corporate structure for foreign investors, given their relative simplicity in operation. JSC's have more requirements, including a minimum of 3 shareholders, and are preferrable for companies which may have a need to issue shares to more parties in the future.

There are also other structures that can be relevant to foreign investors, including:

• Representative Office, and

• Business Co-operation Contract ("BCC")

However, these remain most relevant to specific situations or scenarios.

2. Formal Positions/Responsibilities

The standard positions that each company must have in Vietnam, include:

• Legal Representative: There can be more than one Legal Represenative appointed, but at least one of them must generally reside in Vietnam.

• General Director: The General Director is the person that operates the company on a day-to-day basis.

Note: These 2 positions can be of any nationality, however there may be Work Permit matters to consider for foreign appointees.

• Chief Accountant: This position is appointed once the company is established, and also takes on many of the responsibilities that a "Company Secretary" would do in other jurisdictions.

→ Procedures and Timelines

Foreign investors investing in Vietnam in the form of establishing a new legal entity need to apply for an Investment Registration Certificate (“IRC”) first for its "investment project", then continue by applying for and obtaining an Enterprise Registration Certificate ("ERC") to establish the new company after the IRC is issued.

The process includes three (3) basic stages:

Note: The statutory timings above are the processing with the authorities, and do not include the preparation time for the applications nor the review, preparation or translation of documentation required for the process.

→ Required Documents

Documents required for standard applications for the establishment of a foreign-owned enterprise in Vietnam are listed below. These documents may vary depending on the jurisdiction of the investor, however this provides a general guide as to the documents taht are to be lodged with the authorities.

Where the investor is an individual, and not a corporate, then Items 1 and 2 are not required, and only the passport is required.

The above documents (other than the bank statement/letter) need to go through a legalisation and notarisation process, which will depend on the doucment and the jurisdiction.

→ Other Requirements

1. Business Lines and Investment Objectives

A company must register one or more business lines and investment objectives (attaching to the "investment project"), subject to conditions or limitations regarding certain investment sectors in Vietnam. Companies can only provide services in accordance with their approved business lines. Although most sectors are open for 100% foreign investment, there are some restrictions such as:

• Fully Restricted: Military related, agricultural land, etc.

• Partially Restricted and requiring a local joint venture partner: tourism, advertising, logistics, etc.

• Special Requirements and Restrictions such as the need additional staff accreditation for the license: real estate, accounting services, etc.

2. Investment Capital & Charter Capital

As part of the application to establish a foreign-owned company in Vietnam, the companuy's capital needs to be detailed in the IRC. Specifically:

• Investment Capital (IC): this is total funds that is to be invested into the company by the Investors. IC includes equity (charter) capital, and loans.

• Charter Capital: is the "paid-up capital" of the company, an amount of capital that members or shareholders contribute or commit to contribute within a certain period as stated in the company's charter, and must be fully contributed within 90 days from the date on which the ERC is issued.

3. Bank Account

Companies, once they have received their ERC and completed the initial post-licensing activities, can open bank accounts with Vietnamese banks. The process is far easier, for most banks, than in other countries in the region due to the initial vetting and documentation process undertaken to obtain the ERC, therefore allowing for the banks to rely on this documentation for most of their needs.

LHD LAW FIRM is the Top law firm cosulting for Expat in Viet Nam

According to the rankings of Legal500 and Hg.org, LHD Law Firm is one of the 10 leading legal services in Vietnam for our consultancy of establishing a foreign-owned capital business in our country. With 10-years experience in the field and the office system throughout the country: Ho Chi Minh City, Hanoi, Da Nang, Vung Tau, etc., LHD Law Firm takes pride in our commitment to satisfy our clients as foreign investors in Vietnam.

Client's of LHD Law Firm

In order to seek further advice or request service Setting up a Foreign company in Vietnam, Contract us by