Set up a Company in Vietnam requires a lot of knowledge about market research and legal characteristics to prepare carefully before launching a business project into the Vietnamese market. Questions and answers about the investment process in Vietnam clarify the issues that foreign investors are concerned about before deciding and conducting business investment procedures in Vietnam.
Process to Set up a company in Vietnam?
Here’s the only Vietnam company formation guide you’ll ever need.
What does the Vietnamese company formation process look like?
We will help you apply for an Investment Registration Certificate (IRC) and an Enterprise Registration Certificate (ERC) and once they have all been issued, your Vietnamese company is operational. At first, you will send us a scanned copy of passports and other details on a director and shareholders, capital amount, company names, business activities, company address. We will check if your proposed company names and business activities are available before preparing all draft application documents. We will have the draft application documents sent to you via email. You will have them printed out, signed and returned to us together with other documents prepared by you (notarized copies of passports, proof of funds, and proof of company address). We will check and establish an application file before filing it to a relevant Department of Planning and Investment (a local government agency of a city/ province that registers Vietnamese companies).
What is an Enterprise Registration Certificate (ERC)?
It is a legal document that every Vietnam company must-have. It states all the particulars of your Vietnam company. It is issued by a provincial Department of Planning and Industry (DPI) without a set validity period.
Do I need a company address in Vietnam?
Yes, of course. All Vietnamese companies must have a local registered address. If you don’t have one already, use our virtual address service. We will help you handle your incoming letters, scan and store them so you have easy access to all your documents.
What is an Investment Registration Certificate (IRC)?
It is a legal document that every foreigner or foreign company must obtain when they want to incorporate a new company in Vietnam. Its term of validity is usually less than 50 years and can be renewed upon its expiry, except for certain special cases where the term could be up to 70 years. You are not required to apply for an Investment Registration Certificate (IRC) if you acquire shares/ owners’ equity in an existing Vietnam company. In such a case, you must obtain a prior written approval for such acquisition from the local Department of Planning and Investment (DPI).
How long does it take a foreigner to establish a company in Vietnam?
Once all the applications and supporting documents are ready and in order on our end, it usually takes us about 3 weeks in total to set up a Vietnam company. The breakdown of the timelimit is as follows: the first 2 weeks for obtaining an Investment Registration Certificate (IRC) and another 1 week to get an Enterprise Registration Certificate (ERC). The sooner you provide us with the required details and documents, the sooner you will be able to form a company in Vietnam. The starting point of the timelimit much depends on the availability of the the details and documents to be provided by you.
What is the minimum amount of capital required to form a company in Vietnam?
There is no requirement on the minimum amount of capital to set up a company in Vietnam, except for certain business activities that requires a legal capital. For instance, a real estate company must have a registered capital of VND 20 billion or more. We will advise you about the minimum capital on a case-by-case basis. If you want to decrease or increase the capital amount in the future, La Défesne will advise if so required.
Is it compulsory to have a local shareholder for a Vietnam company?
No, it is not, except for certain business activities that require the certain percentage of local ownership in Vietnam companies.
Is it required to have a local director for a Vietnam company?
No. You don’t need to have any local director in order to form a company in Vietnam.
Must a foreigner visit Vietnam to incorporate a Vietnam company?
Not at all! You can remotely handle Vietnam company incorporation by way of hiring us for the purpose. All you have to do is to provide us with all company details as well as documents in hard copy as so advised by La Défense.
Is it mandatory to open a corporate bank account in Vietnam?
Yes, of course. Your Vietnam company must open a “foreign direct investment account” at a Vietnam bank to receive your capital contribution. It also must open a VND current account as well.
Will my Vietnam company get personalized support from La Défense?
Engaging La Défense to incorporate a company in Vietnam will get you dedicated support (24/7) from qualified lawyers and professionals assigned to you. Our seasoned staff will help you handle all Vietnam company incorporation issues on a case-by-case basis. After the Vietnam company incorporation, we could further assist you in proceeding with any additional registration if so required by law.
Does La Défense provide Vietnam company secretary services?
Yes, we do. We does provide Vietnam company secretary services to its clients as part of its consulting services. Unlike other jurisdictions, a company in Vietnam is not required to appoint a qualified company secretary. We can handle your Vietnam company’s statutory compliance matters by informing the shareholders and the director of the Vietnam company about due dates as well as maintaining statutory registers, company documents and preparing corporate documents if so required.
Will a compulsory registration of change to corporate matters take a long time?
No, it will take not that much time if you hire La Défense Law Firm to help you proceed with the registration. When you want to register a mandatory change to your company’s Investment Registration Certificate (IRC) or Enterprise Registration Certificate (ERC), send relevant details to us and we will do the rest for you.
Is a Vietnam company allowed to hire foreigner professionals?
Yes, it is. A Vietnam company can hire foreign employees as long as they can qualify for a Vietnam work permit or Vietnam work permit exemption under Vietnamese laws.
Are there other post-incorporation issues a foreign owner should be aware of?
Make a company stamp and file a notice of stamp sample with the relevant Department of Planning and Investment Conduct the initial tax registration with the local tax authority Open your Vietnam company’s bank accounts, i.e. a foreign direct investment account, VND current accounts and current accounts in other currencies File a notice of such corporate account details with the local Department of Planning and Investment Inject the registered capital into the foreign direct investment account within 90 days of the incorporation date Make a company sign (company name, tax code & address are required) Apply for sub-licenses, if your business activities requires them Apply for Vietnam investment visa or Vietnam working visas for you and foreign employees Prepare and file periodic tax returns, annual financial statements Pay taxes, if any (CIT, PIT, VAT, fixed annual license tax) Make compulsory insurance contributions in Vietnam And other tasks as the case may be
How much time is required to incorporate a Vietnam company?
It takes us 3 weeks to help you form a Vietnam company. The breakdown of the timelimit is as follows: the first 2 weeks for obtaining an Investment Registration Certificate (IRC) and another 1 week to get an Enterprise Registration Certificate (ERC). However, the starting point of the timelimit much depends on the availability of the the details and documents to be provided by you.
After incorporating a Vietnam company for us, will you support us with the compliance or periodic filing issues?
Yes, of course. Upon registering a Vietnam company with La Défesne Law Firm, we will free advice about relevant periodic compliance issues, mandatory filings as well as corresponding due dates. You will receive emails or notices from us.
Is it possible for a foreigner or a foreign company to hold 100% shares in a Vietnam company?
Yes, it is. 100% foreign ownership is allowed for most business activities, except for certain ones that require certain percentage of local ownership in Vietnam companies. We will advise you about this respect on a case-by-case basis.
What is a Limited Liability Company in Vietnam?
A large majority of foreign-invested companies formed in Vietnam are in the form of the limited liability company. It is ideal for foreigners who want the benefits of limited liability but keep the flexibility of a traditional partnership. Besides, the form of the single-member limited liability company facilitates foreign companies wishing to establish a company in Vietnam with 100% control.
What is a Joint-Stock Company in Vietnam?
This is also a common company structure for foreign owners in Vietnam because it allows the sharing of profits between shareholders as well as keep shareholders restricted from financial liability. The shareholders will only bear responsibility for the Vietnam company’s debts and financial obligations to the extent of their shares and thus, their personal assets will be protected. In addition to various ways of fundraising such as debts/ loans, and private equity (PE) fundraising that a Limited Liability Company can do, a Joint-Stock Company can raise funds by selling stock in public offerings (initial public offering (IPO), secondary public offering).
How many Directors are required for a Limited Liability Company (LTD)/ Joint-Stock Company (JSC)?
Only 1 Director and you can hire as many Deputy Directors as you deem necessary. The Director is not required to be a local person and must be at least 18 years of age or above. Vietnamese citizens or foreigners can hold this position.