Set up a foreign company own business in vietnam
Set Up A Foreign Company Own Business in Vietnam, Experts at Vietnam LLC setup. Set up a wholly foreign-owned entity, joint venture, public limited company, branch or representative office. Business law of vietnam with 4 years and three office in Ho Chi Minh.
Transactional structuring: advising on the possibility for foreign investors to obtain an investment licenses in Vietnam and the selection of an appropriate investment vehicle in Vietnam such as a business co-operation contract, a joint venture company or to set up a company in Vietnam as a wholly foreign owned company.
Licensing requirements: drafting and negotiating all documents required for obtaining an investment licenses for a foreign invested project, following up Vietnamese authorities for obtaining the investment licenses and assisting to complete all post-licensing procedures.
Regulatory issues: advising on regulatory issues in relation to the operation of foreign invested projects in Vietnam including advertising and promotion of their products.
When you starting a business in Vietnam
Vietnam became the 150th member of the World Trade Organization (WHO) in 2007. This opened the door for foreigners to invest and operate businesses in Vietnam. Individuals and organizations are allowed to choose their area of investment, the structure of their business and the method by which capital is raised, as long as their choices are in compliance with Vietnamese law, international treaties and commitments.
Opening a foreign-owned business in Vietnam is possible and even encouraged by the Vietnamese government, although the laws are complex and the process can be complicated. Modern business law is in its infancy in Vietnam. Laws and regulations may be incomplete, ambiguous and subject to conflicting interpretations by different government agencies. Having the help of an experienced and well-connected Vietnamese law firm is highly recommended.
Foreigners are permitted to own and operate their own businesses in Vietnam, either through indirect or direct foreign investment. Indirect investment can be made by individuals or organizations that can buy shares in Vietnamese firms or invest through stocks, investment funds or use other intermediate financial instruments. Businesses that are wholly foreign-owned or are participating in joint ventures with a Vietnamese business are considered to be direct foreign investments.
Exercising rights of importation and distribution
As per regulated at Provision 1, Article 4, Decree 23/2007/ND-CP dated February 12 2007 of the Government providing detailed guidance of Law of Commerce’s regulations on goods trading and directly related activities of FIEs in Vietnam, an FIE is eligible to exercise its rights to import and distribute goods in Vietnam if it meets the following requirements:
- The Investor is from a country or territory which is a member of international treaties to which Vietnam is engaged and committed to open markets for goods trading activities and related.
- Form of investment must be consistent with the roadmap of commitments under international treaties to which Vietnam is a member and in accordance with the law of Vietnam.
- Goods and services must be in accordance with market opening commitments of Vietnam and with of the law of Vietnam.
- Scope of operation must be in accordance with the market access commitments of Vietnam and with the law of Vietnam.
- The business has the approval of the competent authorities in Vietnam.
According to Vietnam's commitments to the WTO, since 2009, foreign investors are entitled to import and distribute goods in the form of a company with 100% foreign capital.
To ensure the eligibility for licensing, in addition to the above conditions, you also have to ensure the following requirements:
- You must be a manufacturer of electric and electronic products expected to be distributed in Vietnam or be a trusted trader of electric and electronic products in the your country.
- The results of business operation in the your country must be positive, shown in the audited financial statements of the last two years.
- Registered office of the Company or wholesale, retail stores must be consistent with the planning of Vietnam. Normally, investors must have a rental office in an office building for the Company’s head office and/ or a place for wholesale and retail at a planned-in-advance trade center.
- Investment capital must be sufficient to ensure the feasibility to implement business projects in Vietnam.
Provide maintenance services
At the moment, Vietnam has no commitment on market access for appliance maintenance services. This means, the competent authorities of Vietnam has no obligation to open the door for foreign investors to participate in providing this kind of service in Vietnam.
However, according to our experience in previous similar cases, the competent authorities of Vietnam may consider allowing you to provide maintenance services for the electric and electronic products distributed by your company.
Types of Business
There are many foreign-owned small businesses in Vietnam, as well as a growing presence of international firms and franchises.
There are three business structures available for those who want to open a business in Vietnam. The business may be:
- A 100 percent foreign-owned sole proprietorship or partnership
- A joint venture enterprise
- A business cooperative that is owned and controlled by the people who use its services
Vietnam encourages foreign investment in certain sectors, including:
- The production of items for export.
- Animal husbandry, farming and the processing of agricultural, forest and aquaculture products.
- The utilization of high technology and modern manufacturing techniques.
- The protection of ecological environments.
- Research and development.
- Labor intensive activities.
- The processing of raw materials.
- The efficient utilization of natural resources.
- Construction of infrastructure facilities and important industrial production establishments.
- Investment in mountainous and remote regions.
- Investment in regions with difficult economic and social conditions.
Not all businesses are open to foreign participation, including those in any sector that may have an adverse effect on:
- National defense.
- National security.
- Cultural and historical preservation.
- Vietnamese customs and traditions.
- The natural environment of Vietnam.
People wanting to establish a new business in Vietnam are required to produce several specific legal documents. These include a valid personal identity card or passport, as well as papers proving financial solvency.
A foreign enterprise wanting to set up an office or factory in Vietnam must provide the following documents:
- A certificate of incorporation.
- A company charter or articles of association.
- Audited financial statements for the past 12 months.
- Valid personal identity cards or passports of any of the business’ authorized representatives.
Although money can be moved into Vietnam, it must be deposited into either a Vietnamese-based foreign currency bank account or be converted into Vietnamese dong. There are significant restrictions governing the movement of money out of the country. Money may only be transferred out of Vietnam if it falls into one of these categories:
- Payment for imported goods and services.
- Payment by foreign investors of.
- Invested and reinvested capital earnings and profits from undertakings in Vietnam.
- The principal and interest on off-shore loans and credits.
- Other legal benefits.
- Payment for travel allowances to employees travelling abroad.
- Payment of salaries to the executives of foreign capital enterprises.
- Payment of salaries to Vietnamese employees working in a foreign country.
- Payment of salaries and other legal income to foreign employees.