Foreign Direct Invested

Company Establishment in Vietnam

Outline

A foreigner or a foreign enterprise can invest in Vietnam in several ways, including establishing a new enterprise, acquiring or investing in an existing enterprise, setting up a branch or representative office, or using contractual arrangements. In this article, we explain the issues regarding establishing a 100% Foreign Direct Invested (FDI) company in Vietnam. Even though the procedure of establishing a FDI company is opened for anyone, but actually it consists with many approval procedures, so it maybe be difficult to proceed it by foreigners.

Establishing Procedure and Timeline

The timeline for establishing a FDI company in Vietnam varies greatly depending on the business sectors that you target to register. E.g. for the software related business sectors, it takes only 3 ~ 4 weeks for all the procedures, so it is one of the quickest business sectors for a FDI company establishment. But on the other hand, some other business sectors such as education, insurance brokerage or hospital may take more than nine months for a company to be established. ※ The green dotted line items in below chart are for some specific business sectors, only.

Prepare Certificates & Forms

In here, 'certificates' mean documents which prove your identity or ability, such as passports, enterprise registration certificates and bank statements of investors. And 'forms' mean applications which describe your decisions and information to establish a company according to Vietnamese law. Almost of the certificates need to be legalized from Vietnamese embassy in your country, and the forms are at least more than 10 types.

Submitting to Department of Planning and Investment (DPI)

If all your certificates and forms are ready for applying the district DPI will receive them and issue a receipt. The receipt mentions a date that you will get Investment Registration Certificate (IRC), but this is not always kept, exactly. Especially, if you target conditional business sectors, the date will not be kept, because of investment approval examination procedure.

Investment Approval Examination

Depending on your business sectors, there may be government examination procedures. In that cases, your incorporation dossiers will be sent to relevant government agencies to get their opinions regarding whether they agree your incorporation or not. The required time for this stage is different with each government agency, and it is generally ranged from 1 ~ 8 weeks per a government agency.

Acquiring IRC, ERC & Corporate Seal

If you receive approval opinions from all government agencies, you will receive the Investment Registration Certificate (IRC) first, after that, there will be Enterprise Registration Certificate (ERC), corporate seal & some related documents regarding your incorporation result. This stage usually takes around 1 week.

Initial Announcement

Once the incorporation is completed, you need to report the initial decision on [1] taxation start date, [2] VAT registration term, [3] depreciation term, [4] business hours and so on. Normally, if you decide to use a bookkeeping company, this stage will be done by the bookkeeping company.

Sub-License Examination

Sub-licenses are only required for some business sectors such as distribution, education and etc. On this stages, depending on your business sectors, the required time varies from 2 weeks to 16 weeks. And also, you may get several request for proving your professionalism on the business sectors.

Required Certificates and Application Forms

We recommend you to find an appropriate administrative agent rather than preparing all the certificates and forms by yourself, because the most time consuming stage to establish a FDI company is preparing all the certificates and forms. ※ The green dotted line items in below chart are for some specific cases, only.

Passport

Notarized copies of all the persons' passports involved in your incorporation are required. There are 2 notarization ways, the first way is getting legalization from your country's Vietnam embassy, and the second way is making certified copies (bản sao) in Vietnam.

Bank Statement

Each investor's banks statement needs to prove that the one has more than the planned amount to capitalize. The each account holder's name must be same as the each investor's name. Bank statement doesn't need to get any notarization procedure, but you need to submit the original copy from the bank.

Business Address Lease Agreement

You must have a lease contract or MOU for your business address, before you start to establish a company in Vietnam. BTW, in almost of cases, incorporation agencies may suggest and support you to use virtual office addresses to proceed your incorporation to be quicker.

Business Registration Certificate

This item is only required, when you have any enterprise investor. This certificate should get Vietnamese consul's legalization in your country, because Vietnamese government has no way to figure out the business certificate is valid or not.

Investor's Charter

This item is only required, if the company to be established is a limited liability company and the investor is only one enterprise. The charter must be acquired [1] translation notarization and [2] Vietnamese consul's legalization in your country.

Material to Prove Your Professionalism

This item is only required, if you target some specific business sectors which need related sub-licenses. The type of this item can be very various according to your target business sectors.

Application Form

The incorporation application forms are consisted with at least 10 kinds, so it is very difficult for ordinary foreigners to prepare all by themselves. There should be [1] implementation project plan, [2] investment projects proposal, [3] company establishment decision, [4] legal representative appointment, [5] financial capacity report, [6] investment requirements satisfaction report, [7] business registration application, [8] shareholder list, [9] charter and [10] corporative seal application. Furthermore, depending on your business sectors, additional application forms can be added. In some cases, there are more than 30 types of documents may be required to establish a FDI company.

Opened Business Sectors

Although the Vietnamese government describes various business sectors that are opened to foreign investors via various documents, it is still difficult for ordinary people to find and understand the contents clearly. If you are planning to establish a company in Vietnam, please feel free to ask us by using the Contact Us form in below.

WTO Agreement

WT/ACC/VNM/48

In 2007, Vietnamese government signed a MOU with World Trade Organization (WTO), and it has first presented a list of opened business sectors to foreign investors.

Download

Vietnam Investment Law

67/2014/QH14

In 2015, Vietnamese government has enacted the revised investment law, and it newly presents a list of conditionally opened business sectors.

Download

Vietnam Industrial Classification

27/2018/QD-TTg

Vietnamese businesses codes are all represented by 4 digits, but sometimes, 5 digits for more details.

Download

Investment Approval Examination

There are 3 situations that you may receive an examination notice regarding your incorporation in Vietnam. [1] The related law has opened the specific business, but there is no actual incorporation case, yet. [2] There is no related law about opening to FDI regarding the specific business sectors. [3] If the specific business is a conditionally opened business sectors. For this examination, there will be questions and requests to evaluate your incorporation from various government authorities such as Department of Planning and Investment (DPI), Ministry of Planning and Investment (MPI), Ministry of Industry and Trade (MoIT) & etc. In some cases, you need to get an inspection of your business address for related sub-licensing procedures.

Three Major Certificates

In general, to clarify the authority of a FDI company in Vietnam, the business registration consists of [1] Investment Registration Certificate (IRC) and [2] Enterprise Registration Certificate (ERC) and [3] Sub-License. ※ The green dotted line items in the chart below are for special industries only.

Investment Registration Certificate (IRC)

It mainly describes information about the investors of the company, and many people call this document as 'blue paper' based on the color of the document. IRC is only available to foreign direct investment companies, so ordinary Vietnamese companies do not have IRC.

Enterprise Registration Certificate (ERC)

It contains all the information regarding the company registration, including the name of the corporation, the address, tax number, legal representative and etc., also called as ‘yellow paper’ based on the color of the document. Regular Vietnamese companies also have ERC.

Various Sub-licenses

In addition to the above two registration certificates, special industries such as distribution, restaurant, construction, education, tourism, medical care and etc. must be verified further for their expertise. Except for some industries, such as distribution, among the above special industries, regular Vietnamese companies must also obtain a sub-license for legitimate business.

Contact Us

If you have any enquiries, please feel free to contact us. When contacting us, please be mention [1] your business sectors, [2] investment capital & [3] intended incorporation schedule. English Telephone consultation is available only from 10:00. to 20:00. on weekdays. Please leave your inquiry in the form on the right side and we will get back to you within one business day.

Skype jennie.ndc
Email jennie@seoul.vn
Phone +84 (0) 8888 85840

Jennie Nguyen   ·   jennie@seoul.vn   ·   +84 (0) 8888 85840
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