The service for establishing a foreign-invested enterprise in Vietnam is a service that helps foreign investors set up an enterprise in Vietnam in accordance with the law.
Attracting foreign direct investment (FDI) associated with sustainable development has become an important goal in Vietnam’s socio-economic development strategy in recent years. Therefore, Vietnamese law has improved regulations on investment law, specifically the establishment of foreign-invested enterprises in Vietnam. To help investors make investments quickly and efficiently, Vinasc is a unit specializing in providing consulting services and carrying out procedures related to establishing foreign-invested enterprises in Vietnam.
I. SERVICE PROVISION PROCESS AT VINASC:
Phase 1: Gather all necessary information to prepare the application for investment project and enterprise establishment
- Vinasc receives information about the proposed enterprise with basic details, including: Type of enterprise, enterprise name, investment capital/charter capital, investor information, contributors, legal representative, business registration address, business lines, email, and phone number.
(See detailed instructions below)
Phase 2: VINASC prepares the application for investment project and enterprise establishment
- Both parties discuss and agree on the service content, then Vinasc drafts the necessary documents based on them to hand over to the enterprise for verification.
- Vinasc receives back the complete verified dossier along with the documents the enterprise needs to prepare to complete the dossier.
Phase 3: Submit application for Investment Registration Certificate
- Vinasc submits an application for an Investment Registration Certificate (IRC) to the investment registration authority:
- Implementation time: Within 25-30 working days from the date of submission.
- Result: Investment Registration Certificate (IRC);
Phase 4: Submit application for Enterprise Registration Certificate
- Vinasc submits the application for the Enterprise Registration Certificate to the Department of Planning and Investment.
- Implementation time: Within 5-7 working days from the date of submission.
- Result:
+ Enterprise Registration Certificate (ERC);
+ Confirmation from the tax authority.
Phase 5: Make the enterprise’s seal
- Implementation time: Within 1-2 working days.
- Result: Enterprise’s seal.
Phase 6: Complete the service & Deliver the results to the customer
- Review all the steps of the service implementation to ensure that the service has been completed comprehensively.
- Hand over to the enterprise the specific results that Vinasc collected on behalf of the enterprise during the service provision process.
Phase 7: Post-establishment procedures*
- *After obtaining the Enterprise Registration Certificate, the Enterprise needs to carry out the following post-establishment procedures (These procedures are not included in the business registration service package, Vinasc will advise and quote the implementation for investors):
- Hang a signboard at the company’s head office address.
- Register a digital signature.
- Register a bank account.
- Register for online tax filing.
- Submit a declaration and pay the license tax.
- Register the VAT calculation method.
- Register and notify the use of electronic invoices.
- Other procedures related to labor and social insurance.
- Prepare full business conditions for conditional business lines.
II. SPECIFIC RESULTS
- Investment Registration Certificate (IRC);
- Enterprise Registration Certificate (ERC);
- Tax authority confirmation;
- Enterprise’s Seal;
III. DETAILED INSTRUCTIONS
- Type of enterprise:
– Similar to domestic investors, foreign investors have the right to choose a suitable type of enterprise to conduct business activities in Vietnam, including: Single-member Limited Liability Company; Multi-member Limited Liability Company; Joint Stock Company; Partnership Company; Sole Proprietorship.
Distinguish different types of enterprise:
| Criteria | Single-member Limited Liability Company | Multi-member Limited Liability Company | Joint Stock Company | Partnership Company | Sole Proprietorship |
| Legal entity status | Yes | Yes | Yes | Yes | No |
| Number of members, shareholders, and capital mobilization capability | Only 01 member (can be an individual or an organization) | From 02 to 50 members, who can be organizations or individuals | The minimum number of shareholders is 03 and there is no limit on the maximum number. | There are at least 02 members who are co-owners of the company, doing business together under a common name and may have additional members contributing capital (limited partners). | Owned by a single individual |
| Liability for property obligations | Bear liability for the company’s debts and other property obligations within the scope of the company’s charter capital | Bear liability for the company’s debts and other property obligations within the scope of the capital contributed to the company | Shareholders are only liable for the company’s debts and other property obligations within the scope of the capital contributed to the company. | – General partners must be individuals and bear unlimited liability with their entire personal assets for the company’s obligations. – Capital-contributing members (Limited partners) can be organizations or individuals and are only liable for the company’s debts to the extent of the capital they have pledged to contribute to the company. |
The owner of a sole proprietorship bears full liability with all of their personal assets for all activities of the enterprise. |
| Capital transfer | Transfer all or a portion of the contributed capital to others in accordance with the law | Transfer all or a portion of the contributed capital to others in accordance with the law | – Within the first 3 years, transfers are only allowed to the founding shareholders. If one intends to transfer to others, the consent of the other founding shareholders must be obtained. – After 3 years, transfers can be made to anyone. |
– A general partnership member does not have the right to transfer their capital, except with the consent of the other general partnership members. – A capital-contributing member (Limited partners) has the right to transfer their contributed capital to others. |
Lease or sell the sole proprietorship |
| The right to make decisions on important matters | Owner | The ultimate decision-making authority rests with the Board of Members. | The highest authority lies with the General Meeting of Shareholders. | The Board of Members has the authority to make decisions on all business activities of the company. However, all decisions must be approved by a majority of the general partnership members. | As a sole proprietorship owner, one has full authority to make decisions regarding all business activities of the enterprise. |
In practice, the Limited Liability Company (LLC) is the most popular type of enterprise chosen by foreign investors due to its characteristics that are well-suited for investment needs in Vietnam.
- Proposed enterprise name:
2.1. The Vietnamese company name consists of two components: Enterprise Type + Proper Name. In which, the proper name is written using letters in the Vietnamese alphabet, the letters F, J, Z, W, numbers, and symbols.
Examples: ABC Limited Liability Company; XYZ Joint Stock Company, …
2.2. Company Name must not be identical or confusingly similar to the names of previously established companies.
We will consult and look up the name of the company you intend to establish.
- Investment Capital/Charter Capital: Currently, the law does not specify the minimum or maximum investment capital/charter capital. The determination of investment capital/charter capital for registration depends on the investor’s needs but must ensure that the capital contribution is made in the registered amount in accordance with the legal provisions on time limit and procedures.
However, certain industries have legal capital requirements (minimum registered capital). We will provide information if the industry you intend to invest in falls under the category of requiring minimum registered capital.
- Information of the investor; Capital Contributor:
You can send a copy of one of the following legal documents for us to prepare your dossier.
- For individual investors/capital contributors: Copy of one of the following documents:
+ ID Card/Passport;
- For organizational investors/capital contributors:
+ Decision on establishment/ Enterprise Registration Certificate (ERC)/Investment Registration Certificate (IRC) or other equivalent documents and legal personal identification documents of the representative according to the authorization to manage the capital contribution, the authorization letter of the owner to the authorized person (if any).
During the process of preparing the documents, Vinasc will also need you to prepare and provide notarized copies of the above documents. For documents issued by foreign authorities, they must be certified or legalized by the diplomatic or consular representative offices of Vietnam abroad; translated into Vietnamese and authenticated in accordance with Vietnamese law.
We will send you the sample documents and guide you through this procedure.
- Information of the legal representative:
Similar to the investor; capital contributor in section 4.
If the investor, capital contributor is also the legal representative, then there is no need to provide the information again.
- 6. Registered Business Address: The company must have a registered business address that is clearly defined and not located in a residential condominium.
Note: To be considered valid, the registered business address must be supported by the following legal documents: Lease Agreement (A legally binding contract between the company and the owner of the premises, outlining the terms and conditions of the lease.); Purpose of Use Certificate (A document issued by the project developer (if applicable), confirming that the premises are designated for commercial use and not for residential purposes.)
- Expected Business Lines: Businesses can be registered in all industries that are not prohibited by law. However, the business must meet all the conditions for conditional industries. (Here is the link to the list of restricted business lines that you can refer to).
- Email: You should register an email for the company you intend to establish.
- Phone Number: You should register a phone number for the company you intend to establish.
Vinasc will review specific legal requirements related to develop a plan for implementing the service.
*Comprehensive List of Required Documents
| No. | Required documents | Implementer | ||
| Customer (1) |
Vinasc Group (2) | Vinasc Group handles on behalf of clients (3) | ||
| 1 | – For individual: Notaried copies of one of ID Card/Passport – For organization: Notaried copies of Decision on establishment/ Enterprise Registration Certificate / Investment Registration Certificate or other equivalent documents and legal personal identification documents of the representative according to the authorization to manage the capital contribution, the authorization letter of the owner to the authorized person (if any). Note: For documents issued by foreign authorities, they must be certified or legalized by the diplomatic or consular representative offices of Vietnam abroad; translated into Vietnamese and authenticated in accordance with Vietnamese law. Documents must be valid and not exceed 6 months from the date of consular legalization, translation, and notarization. |
X | X | |
| 2 | Investor Competency Documents: Financial Statements of the Last 2 Years/ Commitment of Financial Support from Parent Company/ Commitment of Financial Support from Financial Institution/ Guarantee of Investor’s Financial Capacity/ Bank Account Balance Certificate Note: For documents issued by foreign authorities, they must be certified or legalized by the diplomatic or consular representative offices of Vietnam abroad; translated into Vietnamese and authenticated in accordance with Vietnamese law. Documents must be valid and not exceed 6 months from the date of consular legalization, translation, and notarization. |
X | X | |
| 3 | Application for Investment Registration Certificate: 1. Project Registration Request 2. Investment Project Proposal 3. Explanation for Conditional Business Lines (if applicable) 4. Financial Capacity Statement 5. Appointment of Capital Contribution Representative (if applicable 6. The Authorization Letter |
X | ||
| 4 | Application for Enterprise Registration Certificate: 1. Enterprise Establishment Registration Request 2. Company Charter 3. List of Members/List of Shareholders (if applicable) 4. The Authorization Letter |
X | ||
| 5 | Enterprise Seal | X | ||
| 6 | Application for Opening a Bank Account: 1. Bank Account Opening Request 2. Commitment Letter 3. Electronic Tax Filing Service Registration 4. Agreement Letter (if applicable) |
X | ||
(*) According to the procedure, the Client is responsible for providing the documents in column (1) and Vinasc is responsible for providing the documents in column (2).
(*) In some cases, if the Client has difficulty preparing the documents, Vinasc can prepare the documents in column (3) on their behalf. However, in this situation, we must consider each specific case and there may be the following issues:
– Costs for preparing documents (these costs will vary depending on the government agency and the legal regulations in Vietnam at each stage).
– Additional time required to prepare these documents.
(*) During the preparation process, the Client should scan all of the above documents and send them to us so that we can prepare the documents in time.
(*) In some special cases, the government agency may request additional information to supplement the documents.
IV. RISK WARNINGS
- Conducting business activities under the form of an enterprise without registration.
According to Article 46 of Decree 122/2021/ND-CP on sanctions of administrative violations in the field of planning and investment:
– A fine from 50,000,000 VND to 100,000,000 VND shall be imposed for the act of conducting business activities under the form of an enterprise without registration. At the same time, the enterprise is forced to register for establishment. - Capital contribution deadline for foreign investors
On the enterprise’s Investment Registration Certificate, there is a criterion of Total Investment Capital, which includes contributed capital and other types as registered. For the contributed capital, according to the provisions of the Enterprise Law, the investor must fully contribute within 90 days from the date of issuance of the Enterprise Registration Certificate.
The total investment capital on the Investment Registration Certificate is transferred from abroad to the capital investment account in accordance with the capital contribution deadline stated in the Investment Certificate. If the deadline stated on the Investment Registration Certificate is exceeded, the bank opening the capital investment account will refuse to receive capital transferred to the account. Thus, at this time, in order to transfer capital to the investment account, the investor needs to carry out procedures to adjust the Investment Registration Certificate regarding the extension of the capital contribution deadline.
Besides, depending on the needs of customers, VinaSC often advises and supports investors to control well the contents related to the above services such as: tax-accounting, labor, social insurance, salary, sub-licenses… in a complete and compliant manner with the laws of Vietnam that you can refer to.
Please contact VinaSC for the best advice and support for the above services.