How to Start a Business in Vietnam?

How to Start a Business in Vietnam?

In recent years, Vietnam has become an attractive destination for foreign investment thanks to its advantages of security, political stability, and favorable geographical position to trade with the world. This is both the connection center of the region and the gateway to penetrate the economies in the western region of the Indochina Peninsula. In addition, the Vietnam government has increasingly been offering more preferential policies to create favorable conditions for foreign investors to start doing business in Vietnam.

To start a business in Vietnam, investors first need to choose for themselves an appropriate type of business based on the number of capital contributors, the amount of capital contributed, and the business’s purse. According to the provisions of Vietnam law, foreign individuals and organizations can establish a limited liability company or a joint stock company or a partnership or a private enterprise.

The next issue that needs to be considered is the business line. In order for the company to be able to operate, the company must register the appropriate business lines, related to business activities. If the selected line of business does not require conditions, the enterprise can go into operation after the establishment of the company. This is considered non-conditional business area which most of company would do. However, if the investor chooses a conditional business line to do business, the enterprise must meet the necessary requirements, apply for a business license as prescribed, and then go into operation. This is considered conditional investment area where there are some restrictions being required license, minimum charter capital, foreign ownership ratio…

Investors also need to choose a location for their business, which is legally allowed to conduct business activities. The company address must be located in the territory of Vietnam, and comply with requirement corresponding to purpose of business i.e. company address can not be in an apartment building or a dormitory for living purposes only; factory location has to be at proper zone for industrial purpose…

In order to serve the management of the State and facilitate business activities, newly established businesses need to have their own name and this proper name must be unique, not be the same or similar to previously registered businesses. Enterprises are not allowed to use the names of functional agencies, state management agencies to name the company. The name of the business must include the type of company and proper name. To avoid duplication with other companies, businesses can use abbreviations or English names, but must ensure that the company name will not cause confusion, without adding prefixes, suffixes or cultural symbols in the name of the business.

The investors need to apply for an Investment Registration Certificate at a competent authority in Vietnam. This is a mandatory procedure for all projects that want to establish a new legal entity in Vietnam. The processing time for an investment certificate application is around 30 days depending on the specific project. After being granted an Investment Registration Certificate, foreign individuals and organizations need to prepare an application for an Enterprise Registration Certificate at the Department of Planning and Investment which would take around 7 days. Completing this procedure, the enterprise has the legal status according to the provisions of the Law on Enterprises of Vietnam.

From day one since commencing its operation, the company could by itself or hire professional to assist with monthly compliance service i.e., submit foreign labour reports, submit investment report, submit tax report, submit health and insurance reports to authorities to avoid encountering penalties.

ANT Lawyers – a law firm in Vietnam will always follow up with authorities for legal update on matters relevant to investment registration or doing business  in Vietnam.

Source ANT Lawyers : https://antlawyers.vn/library/how-to-start-a-business-in-vietnam.html 

Read More

How has streamlined the registration procedures for business in Vietnam in 2023?

How has streamlined the registration procedures for business in Vietnam in 2023?

By the end of 2019, more than 30,000 FDI projects with a registered capital of approximately 362 billion USD had chosen Vietnam as their investment destination. As a result of Vietnam's recent focus on the private sector, foreign investors are flocking to the country's market.

How Vietnam Has Streamlined Procedures to Register Business in Vietnam?

Vietnam's participation in various free trade agreements has provided a strong impetus for foreign investors from developed nations to take their first steps in Vietnam. The country has established diplomatic ties with nearly 190 nations worldwide and signed approximately 15 Free Trade Agreements with important trading partners.

Investors must submit an application for the Investment Registration Certificate in order to register a business in Vietnam. The investor must then apply for an Enterprise Registration Certificate after receiving the Investment Registration Certificate.

Investors must first select a business name that is not identical to or confusingly similar to the name of another business that is already registered in the National Database of Business Registration on a national scale. This does not apply to business that have been dissolved or that have had effective court decisions declaring them bankrupt.

The investors or authorized person must then prepare a comprehensive set of application dossiers in accordance with the law and submit them to the Business Registration Office where the planned head office will be located. Based on the appointment date on the receipt, the Business Registration Office will verify the validity of the application dossier. Investors or authorized individuals can either go to the Business Registration Office to receive the application results or register to receive them by mail. After receiving the valid dossier, the deadline for considering and processing it is three working days.

The investor will be granted an Enterprise Registration Certificate when fully meeting the following conditions:

-The registered business lines are not in the prohibited business sectors;

-The business’s name is set in accordance with the provisions of law;

-Having a head office as prescribed by law;

-Having a valid business registration dossier as prescribed by law;

-Fully paying the enterprise registration fee as prescribed by law

Investors have increased their faith in Vietnam's business and investment climate over time. The socio-political and macroeconomic steadiness are conspicuous highlights for the development of Vietnam's business potential. The Vietnam not set in stone to work on the cycle for speculation application. As a result, Vietnam is and will continue to be an appealing location for investment as well as a promising location for foreign investors to apply for an investment registration certificate and register a business when compared to other countries in the region that are neighboring Vietnam.

ANT Lawyers is a law firm in Vietnam that will always contact the authorities to obtain legal updates on issues pertaining to the registration of investments or the establishment of business in Vietnam.

 

Read More

How do I establish company in Vietnam?

How do I establish company in Vietnam?

To establish a limited liability company, joint stock company or partnership company in Vietnam, foreign investors may invest 100 percent of their capital.

To receive investment registration certificates, first-time foreign investors in Vietnam must have investment projects and complete investment registration or examination procedures at state investment agencies. Business registration certificates and investment certificates must be issued simultaneously. Since the investment certificate was issued, a company with entirely foreign capital has been in existence.

A project dossier to establish company in Vietnam shall comprise:

-Registration/Request for issuance of Investment Certificate;

-A report on financial capability of the investor;

-Draft of the company’s charter;

-List of members of company;

-Copy of the people’s identity card, passport or other lawful personal certification, for individual members;

-Copy of the establishment decision, business registration certificate or other equivalent document, for member organizations;

-Copies of the authorization document, the people’s identity card, passport or other lawful personal certification, for authorized representatives.

-Copies of the business registration certificates of the foreign member organizations must be authenticated within three months before the date of submission of the business registration dossier by agencies where such organizations are registered;

-Written authorization of the investor in case investor is organization and valid copy of the lawful personal certification of the authorized representative. Documents in foreign languages must be translated into Vietnamese, notarized and legalized;

-The joint-venture contract or Business Cooperation Contract (BCC);

-Other documents required by Vietnam law.

Starting a business in Vietnam would take anywhere from 30 days. The additional time may be required on the off chance that the venture region is contingent or the State government necessities to look at the speculation project. In some investment projects, minimum capital, special licenses, or other conditions may be required.

ANT Lawyers would like to assist you in establishing a business in Vietnam. We have staffs that are highly skilled and have a lot of experience with foreign investment.

Read More

How Vietnam Has Simplified Procedures to Register Business in Vietnam?

By the end of 2019, there have been more than 30,000 FDI projects choosing Vietnam for investment, with a total registered capital of about 362 billion USD. Recently, business propensity of Vietnam is highly concentrated on the private sector, attracting foreign investors to the Vietnam market.

As Vietnam has built diplomatic relationship with nearly 190 countries around the world and signed about 15 Free Trade Agreements with important trading partners, Vietnam’s participation in various free trade agreements has created a strong impetus for foreign investors from developed countries to set their first steps in the Vietnam.

To be able to register a business in Vietnam, investors need to carry out procedures to apply for the Investment Registration Certificate. After being granted the Investment Registration Certificate, the investor shall  then apply for Enterprise Registration Certificate.

To carry out the process of applying for the Enterprise Registration Certificate, firstly, the investors need to choose a name for the business, which must not be identical or confusing to the name of another business already registered in the National Database of Business Registration on a national scale, except for businesses that have been dissolved or have had effective court decisions declaring businesses bankrupt.

After that, the investors or the authorized person need to prepare a complete set of application dossiers in accordance with the law and submit it at the Business Registration Office where the head office is planned to be located. The Business Registration Office will check the validity of the application dossier, based on the appointment date on the Receipt, the investors or the authorized person can go to the Business Registration Office to receive the results of the application or Register to receive results by post. The time limit for considering and handling the dossier is 03 working days from the date of receiving the valid dossier.

The investor will be granted an Enterprise Registration Certificate when fully meeting the following conditions:

-The registered business lines are not in the prohibited business sectors;

-The business’s name is set in accordance with the provisions of law;

-Having a head office as prescribed by law;

-Having a valid business registration dossier as prescribed by law;

-Fully paying the enterprise registration fee as prescribed by law

Over the years, investors have built confidence in the Vietnam’s business and investment environment. The socio-political and macroeconomic stability are prominent features for the growth of Vietnam’s business potential. The Vietnam government has determined to  simplify the process for investment application. Hence, Vietnam is and will continue to be an attractive investment location, a promising destination for foreign investors for applying for investment registration certificate and register a business in Vietnam compared with other neighboring countries in the region.

ANT Lawyers – a law firm in Vietnam will always follow up with authorities for legal update on matters relevant to investment registration or business setting-up in Vietnam.

Source ANTLawyers: https://antlawyers.vn/library/procedures-to-register-business-in-vietnam.html

Read More

What Are the Advantage of Foreign Investors in Setting up Business in Vietnam in 2023?

What Are the Advantage of Foreign Investors in Setting up Business in Vietnam in 2023?

Located in an important position of Southeast Asia, Vietnam has a long coastline of more than 3,000 km. With a diverse geographical structure interspersed with mountainous, highland and coastal areas suitable for general economic zones, Vietnam has ideal conditions to develop the trade and tourism industries. When setting up business in Vietnam, investors can enjoy financial advantage such as corporate income tax, import and export tax and land finance incentives.

Incentives on corporate income tax: In recent years, Vietnam has gradually reduced the corporate tax rate (CIT). In the 2004-2008 period, CIT was 28%, in the 2009-2013 period it was 25%, from 2014 to 2015, 22% and from January 1, 2016 until now, 20%. In addition, the provision of high corporate income tax incentives for a number of key fields that need to be encouraged for investment has contributed to attracting investment, encouraging business, creating favorable conditions for enterprises to increase accumulation, increase investment in the economy, and promote growth, hence promoting investors in setting up company in Vietnam.

Import and export tax incentives: The 2016 Import and Export Tax Law has added regulations that high-tech enterprises, science-technology enterprises, science-technology organizations are exempted from import tax on raw materials, materials and components that cannot be produced domestically within 5 years from the date of commencement of production. There are also import and export tax incentives being applied such as:

(i) Exemption from import tax for goods imported for processing for foreign countries and when exporting and returning products to foreign parties, they are exempt from export tax;

(ii) Goods imported for processing that are exempted from tax, goods temporarily imported for re-export and goods being raw materials and supplies in service of the production of exported goods can be extended the tax payment time to 275 days from the date of filing the customs declaration; goods temporarily imported for re-export may be extended the tax payment time to 15 days from the expiration date;

(iii) Exemption from import tax on goods to create fixed assets for investment projects in areas of special investment encouragement, investment promotion fields and investment projects in the locality have difficult socio-economic conditions.

Incentives on land finance: Foreign enterprises investing in Vietnam can be applied adjusted reduce rate (%) calculating the general land rent from 1.5% to 1%. In addition, the State also stipulates the application of the land price adjustment coefficient in determining the land price to calculate the land rent, therefore, making Vietnam increasingly becoming a favourable destination to attract foreign investment and company establishment in Southeast Asia.

In addition, the development of a transparent and consistent investment legal system is increasingly becoming a good tool to promote foreign direct investment inflows into Vietnam in the spirit of the state ensuring the rights of the investors’ ownership, investment capital and other interests of foreign organizations and individuals, creating favorable conditions and simplifying procedures for such organizations and individuals to invest in Vietnam. Compared with the foreign investment laws of some countries in the region, the law on foreign investment in Vietnam is considered by the international public to be more open and attractive, for example applying the form of 100% foreign capital ownership, administrative procedures are simplified, non-discriminatory between Vietnamese enterprises and foreign-invested enterprises. The law has been transforming in the direction of considering investment and business as the matters of enterprises and investors, which the investors have full authority to make decisions from investment projects to the formation and business of the enterprise and that the government only guides, creates an open legal environment, has favorable mechanisms and procedures, supervises and enforce the law.

ANT Lawyers – a law firm in Vietnam will always follow up with authorities for legal update on matters relevant to investment registration or business setting-up in Vietnam.

Source ANT Lawyers: https://antlawyers.vn/library/what-are-the-advantage-of-foreign-investors-in-setting-up-business-in-vietnam.html

Read More

Introduction to Setting-up Company in Vietnam

Foreigners are encouraged to make investment in Vietnam through direct investment by Setting up company in Vietnam.

However there are restrictions in some cases in regard to investment capital, investment area, special licenses required. The investor is suggested to consult with a law firm in Vietnam for advice and service offering.

Before setting up business in Vietnam, ask yourself the following questions:

1. Which business should I invest in Vietnam?

There are non-conditional investment areas and conditional investment areas. Establishing company in the non-conditional investment areas are more simple than in conditional investment areas. Investment in IT services, manufacturing, management consulting, business promotion are a few samples of non-conditional investment areas. Example of conditional investment areas are real estate, trading, travel agencies, freight forwarding… which are more complicated with investment conditions.  Investment conditions might also be changed over the time depending on the WTO commitments which Vietnam enters.

2. What should I name the business in Vietnam?

The company in Vietnam has to have Vietnamese name, and English name. The company could also have abbreviated name.  The name of the company in Vietnam indicates the structure of the company, the business lines, and the name that differentiate against other businesses.  For instance, the company could be named Alpha consulting limited liability company.

3. Where should I register the address of the business in Vietnam?

Not every address could be used to register a company.  The address has to be an address of a house with leasing agreement or office building which owner has license to operate as office building.

4. What is the legal structure of the company?Depending on the number of investor contributing capital, company could be set-up as one member limited liability company or two ore more member limited liability company or joint stocks company.

5. How much capital is required to set-up a company in Vietnam?

The investment amount depends on the business plan and is subject to the approval of the provincial Department of Planning and Investment evaluating application dossier. In some business areas like real estate, banking and finance, minimum capital is required. In general for non-conditional investment area, the law does not specify the minimum capital to establish a company in Vietnam however the State agencies that evaluate investment plan could reject the investment project which are not feasible. Bank statement in foreign banks could be used to prove sufficient fund of investment capital.

6. Whom will be legal representative and work permit in Vietnam?

The investor will need to appoint the legal representative in Vietnam to oversee the business performance and take legal responsibility in Vietnam. If the legal representative is an expatriate, whom is a capital contributing member or owner of a limited liability company or a member of the Board of Management of a shareholding company which is registered to operate in Vietnam, he or she will be exempted from work permit in Vietnam. Otherwise, he or she will need to have a work permit to work in Vietnam legally.  The work permit holder would then apply for temporary residence card to live in Vietnam as long as the work permit allows.

7. How long does it take to set-up a company in Vietnam?

It depends on what type, scale, and whether or not conditions are required. For a simple minimum capital without conditions to set-up, it would take 30 working days. For setting up company in conditional investment areas i.e.  trading company in Vietnam, time would be lengthen due to the involvement of a number of State agencies approving the investment project and it would take 60 working days. For setting up company in other investments in areas requiring conditions to meet, time might be taken depending on the type of conditions and the government agencies evaluating the conditions of investment.

8. Whom will be granting the investment license in Vietnam?

For most of the investment projects, the provincial state agencies with the approval of the Department of Planning and Investment (DPI) will be granting the Investment Certificate in Vietnam. However, depending on the type, scale, and whether or not conditions are required, other Vietnam State agencies might be involved. For the case of trading company, ministry of trade and commerce, ministry of finance, provincial people’s committee will be reviewing the investment application dossier as well.

9. What are the tax liability in Vietnam?

Major taxes in Vietnam are corporate income tax, import and export tax, value added tax, and personal income tax in Vietnam. In some special areas, there are other taxes. The corporate income tax is currently at 22% and will reduce to 20% beginning 2016. Export is mostly encouraged as such the export tax is 0 however there are spec

Read More

The Regulation on Science and Technology Enterprises in Vietnam

The science and technology enterprises (S&T Enterprises) means an enterprise implementing production and business science and technology service to make a goods or product from results of science research and technology development. The S&T Enterprise’s operation is based on the successful application and exploitation of research process in itself or the results of scientific and technological research from the scientists, organizations or research results transferred from abroad that they have the lawful ownership use rights. The Government issued the Decree No. 13/2019/ND-CP dated on February 01^st, 2019 on science and technology enterprises.

The setting up of S&T Enterprises in Vietnam is only acceptable when meeting the following conditions for granting Certificates of science and technology enterprise, which is acting as operation license as well as basis for implementing the incentives and support policy for investment and takes effect nationwide: i) Established and operated under the Law on Enterprises; ii) Being able to create or apply scientific and technological results which are evaluated, appraised and recognized by competent authorities; iii) Obtaining turnover form the production of, and dealing in, products and goods created from scientific and technological results for at least 30% of the total turnover. This condition shall apply in case the enterprises is established to or more 5 years.

Certificate of science and technology enterprise is issued by the Department of Science and Technology or National Agency for Technology Entrepreneurship and Commercialization Development (NATECH) belonging to the Ministry of Science and Technology depending on each specific case.

One of the important provisions related to the S&T Enterprises of Decision No. 844/QD-TTg of the Prime Minister dated on May 18^th, 2016 on approval for “Assistance policies on national innovative startup ecosystem to 2025” stipulates for continuing to implement the Project of Vietnamese Silicon Valley. This Project have been creating the most favourable conditions for development of the S&T Enterprises and encouraging S&T Enterprises to research, improve their goods or product to meet the demands of market.

With the application of scientific research results and technological development into production and business activities, S&T Enterprises not only bring new high quality products which are able to compete with imported goods, but also encourage science and technology research and application into production and business. S&T Enterprises are entitled to enjoy preferential on enterprise income tax exemption and reduction; exemption and reduction of land and water surface rent; credit incentives;… and especially supporting research activities and commercialization of new scientific and technological results supplemented by Decree No. 13/2019/ND-CP.

The promotion of commercialization of science and technology results contributes actively to the development of the science and technology market, facilitates the application of research results to real life. Every year, Vietnam has thousands of research results and inventions from universities, research institutes, research centers, domestic research groups and foreign organizations and individuals registered in Vietnam. But very few research results are applied to production or commercial products on the market. In order to resolve this situation, the Vietnamese Government supports the S&T Enterprises through policies on enjoying import and export tax; use of research equipment in national key laboratories, technology incubators,… of the State; investment preferences of the Scientific and Technological Development Fund and other funds; priority to participate in projects to support the commercialization of the results of science and technology, intellectual property of the State;… as stipulated in Decree No. 13/2019/ND-CP and relevant legal documents.

Read More

President of Ireland visit Vietnam and Promote Investment

President Michael D. Higgins has begun a State visit to Vietnam to promote cooperation with Vietnam and encourage Irish businesses’s investment and setting up companies in various sectors, including trade – investment, education – training, green technology, wind energy, agriculture, health and sustainable development.

Vietnam and Ireland trade turnover has grown strongly in recent years (particularly for first 9 months of 2016, which reached USD 798 million, more than 3 times compared to the same period of 2015). Vietnam agrees to create favorable conditions and encourage enterprises Ireland to set-up company in Vietnam to promote trading, technology transfer, especially in the areas of investing in renewable (wind) energy projects, agriculture and food processing, information, communication, medical, and aviation…, especially in the context of the free Trade Agreement between Vietnam and the EU is about to be signed and implemented. The two sides also agreed to consider education, training as key areas of cooperation in the future and encourages higher education establishments of the two countries.

It is appreciated that Government of Ireland considers Vietnam as a priority partner in development cooperation policy, and that projects funded by Ireland have been effectively implemented, which contribute significantly to the Vietnam social economic development. According to President Michael D. Higgins, Ireland will soon announce the national strategy for development cooperation with Vietnam in the period 2017 – 2020 to support poverty reduction, adaptation to climate change and implementation of the sustainable development objectives.

Wishing to strengthen the friendship and mutual understanding between the people of Vietnam and Ireland, the two sides agreed to promote cultural exchanges, art and promote the role of the Vietnamese community Vietnam in Ireland, contributing to boosting bilateral cooperation in other fields.

The state visit of Ireland President will definitely open a new chapter of economic relationship between Vietnam and Ireland, laying grounds for further investment from Irish investors in various sectors, especially in wind energy investment, aviation, education, technology, medical and many other opportunities, through direct investment i.e. setting up companies, investing in projects in Vietnam in various forms.

ANT Consulting is here to assist you from the outset; providing corporate intelligence, risk advisory, management consulting services that assist market entrance, and ensure efficient business start-up operation.  Our services are as following:

• Advisory
• Market Entry
• Tax Advice
• Legal Advice

We strive to save your cost by guiding you towards economical solutions that comply with local legislation and procedures. We support you through early logistic solutions and carry you through as your business grows.  We aim to bridge the gap between international best practices and local cultures and assist foreign companies and organizations entering Vietnam market to overcome commercial and regulatory issues.

We could be reached at email: ant@antconsult.vn or tel: +848 3520 2779 .  To learn more about us, please visit www.antconsult.vn

Read More