Setting up a company in Vietnam for Foreign Investors

Under the Law of Investment in Viet Nam and Viet Nam’s commitment to the WTO and EVFTA agreement, the foreign investor is allowed to set up a Foreign Owned Enterprise to do business in Viet Nam. For opening a new company in Viet Nam, foreign investors have to submit the Application for Investment Registration Certificate and Enterprise Registration Certificate complying with the provisions of Vietnamese law. The duration for steps 1 and step 2 takes around 20 working days according to the Law of Viet Nam, but it usually takes longer in practice. Based on our experience, key success factors are the investment capital and the location of the project

Relating to the application for investment registration, the foreign investors need to prepare works as follows

1) The location for the project:

The size of the location depends on each project, and the competent agency does not require any fixed size for each kind of project. However, it should be suitable for the project, and the investor needs to explain the project's location in the Application for Investment Registration.

The foreign investor cannot use the virtual office for registering the investment project in Viet Nam.

2) The line of business:

The business’s areas of investors must not be on the List of industries and trades banned from investment under the Law on Investment 2020 and other related regulations.

3) The capital of the project:

Foreign investors must show their financial obligation to establish a company in Viet Nam. The proof is the bank balance showing the money in their bank account. For the company, foreign investors also prepare audited financial reports for at least two years.

The dossier for applying for the investment registration certificate includes the following:

An application for registering the investment registration in Viet Nam (forms under the Law of Viet Nam);

The bank balance for verifying financial ability;

The documents verifying the investor’s legal status, such as the passports or the company registration certificate issued from the country where the investor comes from;

The foreign documents need to be legalized and translated into Vietnamese for use in Viet Nam.

The investment registration authority responds to the application for the Investment Registration Certificate to the investor within 15 days from the date of receipt of a valid dossier.

Step 2 of setting up a company in Viet Nam is to submit the Application for Enterprise Registration Certificate. It takes 05 working days from the date the competence agency accepts the application under the Law of Enterprise. In this step, the legal conditions are not as complicated as submitting the Investment Registration Certificate. The foreign investor has to prepare the documents as follows:

- The Application for register the company (forms under the Law of Enterprise);

- The company’s charter;

- The documents verifying the investor’s legal status, such as the passports or the company registration certificate issued from the country where the investor comes from;

- The Lists of investors;

- The Investment Registration Certificate.

The Dossier for the enterprise registration Certificate can be submitted in person at the Department of Investment and Planning or online on the national registration business website.

With the reduction of the administrative barrier, foreign investors can establish an enterprise in Viet Nam with a short time and with simple documents. However, foreigners must comply with the Laws of Viet Nam to establish an enterprise. To save time and efficiency in preparing the dossiers, it has been suggested that lawyers in Viet Nam assist in carrying out investment and enterprise registration procedures.

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DB Legal is a full legal service law firm in Da Nang, Viet Nam. Our Lawyers bring enormous legal experience for both local and foreign parties in Central Viet Nam, mainly areas in Da Nang, Hoi An, Nha Trang, Hue, Quy Nhon ,etc.

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