1. Can a foreigner owns a company/business in Vietnam?
- Yes. Vietnam allows 100% foreign ownership in most sectors. Some business lines such as tourism, logistic, advertising, media & tv, telecommunication, education… shall require a Vietnamese join venture partner or with some conditions.
2. How a foreign investor can invest/do business in Vietnam?
Foreign investors can invest/conduct business in Vietnam under one of the following forms:
- Register a 100% foreign owned company or a join venture company (with one or more local partner);
- Purchase share/capital of an existing company in Vietnam or contribute capital to an existing company in Vietnam;
- Invest under business cooperation contract to carry on an investment project/a business;
- Register a branch (of the mother company) in Vietnam.
Besides, foreign investors can register a representative office in Vietnam. However, a
representative office is not allowed to conduct commercial and business activities.
3. What kind of companies a foreign investor can set up?
- Foreign investors can consider one of the following type of company: a Join Stock
Company, a Limited Liability Company (with one member or from 2 member), or a
partnership company.
- Two common type of company that investor often choose is limited liability company
and join stock company.
4. What are conditions for incorporation license?
- Capital: in general, there is no minimum capital requirement for establishment of a company in Vietnam. However, the registered capital should the activities of the company. From our experience, the most common of minimum capital in Vietnam is US$ 10,000 for a service company. For manufacturing company, the funds should exceed the cost of machinery and first year of operational expenses.
For some conditional businesses such as real estate, hospital, finance, insurance, education, tourism…requires a minimum capital.
- Registered address: foreign investors are required to provide evidences for the company’s address, such as rental agreement. While a service-base business can use a virtual office for the registration, a manufacturing company shall need to provide a physical business location.
- Resident Director and Legal Representative: it is a must that all companies need at least one resident director and a legal representative. Resident Director and Legal Representative can be the same person, but non-resident director can’t be a legal representative. The legal representative doesn’t need to have a residency status at the time of incorporation, however, he/she will need a residential address in Vietnam.
5. How is the procedure and how long doesn't it take license for incorporation in Vietnam?
Foreign investors are required to follow the bellow basic procedure for unconditional incorporation licenses:
- - Step 1: Apply for Investment Registration Certificate (IRC): 15 working days (actual time is normally longer, from 30 days to 180 days depends on the business area);
- - Step 2: Apply for Business Registration Certificate (BRC): 3 working days
- - Step 3: Tax registration and payment of annual licensed fee: 7 working days
For conditional business, the procedure shall require a few additional steps, such as: contribution of capital and apply for specific activities business licenses.
6. What does the foreign investor need to prepare for the application of the incorporation?
All business requires documents, including financial proofs. Depends on type of business and whether the founder is an individual or a company, the documents is different.
Basically, the documents shall include the followings:
- Founder’s document: Individual requires a notarized passport and a bank statement of the founder; Corporate requires incorporation certificate, decision or resolution of mother company for incorporation in Vietnam, and authorized representation.
- Article of association;
- List of directors;
- Two years of financial statements (or a bank statement if the mother company was formed less than 2 years to date);
Please note that, all documents must be notarized and legalized in the issuing country.