Areas prohibited to set up company in Vietnam

 Vietnam encourages investors to set up company in Vietnam

With the public authority's endeavors in working on the venture and business climate, which is good for homegrown financial backers as well as unfamiliar financial backers, Vietnam's monetary, political and social circumstance has consistently stayed stable and accomplished extraordinary advancement, over the course of the time including the post-Coronavirus period, while laying out reciprocal exchange relations with numerous nations the world. In an effort to open up the economy, the government keeps changing its policies to support business development and improve the business environment. Specifically, the public authority resolves to energize unfamiliar financial backers carrying on with work in Vietnam: to start a business, build a factory, or buy shares in a Vietnamese company, or to invest in Vietnam in various sectors that will benefit the economy.

In general, foreign investors are permitted to establish a business and invest in Vietnam. Up until the end of 2022, the capital for Foreign Direct Investment (FDI) registered is USD 439 billion, and the FDI attracted in 2022 alone is USD 27,7 billion. In practice, a significant number of them have established businesses in Vietnam and have made substantial investments in manufacturing and production, real estate, energy, technical fields, wholesale and retail product trading, and other related industries.

Areas prohibited to set up company in Vietnam

It should be noted that the following are prohibited areas of business in Vietnam: i) dealing in illegal drugs; ii) minerals and chemicals are traded; iii) exchanging examples of plants and wild creatures; iv) the prostitution industry; v) buying and selling people, tissues, organs, human hatchlings; vi) human cloning-related business practices; vii) exchanging fireworks; viii) Businesses that provide debt collection services, including debt collection services, which were recently added to the prohibited list in the beginning of 2021 due to the negative social impact that debt collection companies in Vietnam have had.

The general requirement for both domestic and international investors is that they are permitted to engage in business investment activities in trades and industries that are not prohibited by law. The remaining trades and industries are divided into conditional and ordinary business lines, with the exception of the trades that are prohibited from business investment. In normal business lines, financial backers can openly enter without boundaries. Interestingly, contingent business lines set conditions that should be met assuming the financial backers wish to join. Understanding the lawful condition to work in a particular industry and business line is the initial step for financial backers to enter the market to set up organization in Vietnam.

Read More

Setting up Company in Vietnam and Comply

Setting up Company in Vietnam and Comply: Quick Tips for Foreigners

A foreigner moving to a country like Vietnam with business opportunities is attempting to start a business and seize the opportunity. After settling in, the entrepreneur might wonder, "How difficult it is to set up company in Vietnam or how challenging the business environment in Vietnam is for operating and doing business when dealing with administrative procedures from registering investment, setting up the company, complying with periodic reporting and tax declarations?"

As a spot with an ideal topographical position and copious work assets, and developing purchaser market, Vietnam is progressively growing emphatically, turning into a nation drawing in worldwide venture among Southeast Asia nations. Foreign investors must conduct research on Vietnam's policies, investment incentives, legal requirements, and the process and procedures for establishing a business in order to carry out effective investment activities. If international investors are considering investing in Vietnam, this will provide some quick advice on the fundamental factors they should take into account.

An individual or an organization established under foreign law could register investments and conduct business activities in Vietnam. Foreign investors are permitted to participate in any legal business, but in order to register an investment, they must meet certain industry requirements. There are a few areas in Vietnam where foreign investors cannot do business due to national security concerns or the state's monopoly.

An investor who wants to start a business in Vietnam must get a certificate of investment registration from an authorization agency, according to Vietnam law. The Investment Registration Certificate (IRC) will typically be issued within 15 days of receiving a valid dossier for an investment project. Be that as it may, it means a lot to work in the ideal opportunity for setting up the legitimate records for example application, monetary report, bank balance, individual archives and large numbers of such records require apostille, or authentication and legitimization and interpretation into Vietnamese prior to being submitted.

Except for conditional investments and business lines, Vietnam law does not mandate a minimum capital requirement for starting a business. Yet, financial backers are obliged to contribute capital as per the timetable expressed in the IRC and that the public authority has the privilege to demand the financial backer to make sense of the strategy agreeable to them in light of the proposed speculation capital. In the event that the financial backer can't contribute sufficient capital as per the serious time limit, the skilled authority might apply sanctions, including denial of the IRC or the financial backer needs to change the IRC to mirror the real commitment of venture. Once having the IRC, the financial backer then solicitation to get Endeavor Enlistment Endorsement (IRC) which requires 5 days from the date of accommodation of legitimate dossier for business foundation to finish the business setting up process.

Now that the company has established itself in Vietnam, it can officially sign a lease agreement, hire staff, and engage in business transactions to purchase or sell goods or services. The documents must be signed and sealed to be legally binding.

Then the question is how to have a seal?

When an organization was managed by the Public Security authority, it was more difficult to have a seal created for it after it was established. Legislators and business experts have been discussing the possibility of completely removing the seal from legal documents in Vietnam because the signature of the legal representative is the most crucial element. The law governing the issuance of seals has become less strict over time. However, in Vietnam, the seal is still very important because it shows the official notice, such as the decision by the business's legal representative to end a labor contract, along with the signature of the representative. or on the other hand a conspicuous endorsement of a substance to an exchange it enters to enlist a development organization for building a plant. Contingent upon the terms in the organization's contract, the financial backer has the privilege to make more than one seal to utilize. Before using, altering, destroying, or altering the number of seals, the company must send a notice to the business registration office where its head office is located for publication on the National Business Registration Portal. The day the notification process is completed and the seal sample is uploaded to the National Business Registration Portal for verification, the seal can be used.

During the activity of the business in the wake of being begun, the financial backer requirements to focus on charge commitments, which is vital in many purviews besides in charge paradise nations. However, Vietnam is not included on the exemption list. Every business is required to provide a tax declaration. Consistently, the business should pay various charges and expenses, for example, permit charges (in view of enlisted sanction capital); When a company earns a profit, it must pay Corporate Income Tax (CIT); announce and cover Worth Added Expense (Tank) for sold labor and products, for individual proclaim and settle Individual Annual Duty (PIT), or at times send out assessment and import charge, charge on lands.

The investment project reporting regime must also be fully adhered to by foreign investors in accordance with the law. These reports will be issued on a regular basis (monthly, quarterly, or annually) regarding topics such as: carried out venture capital, business speculation results, data on work, utilized unfamiliar laborers, investigates natural insurance… Agreeing with the execution of expense installment commitments and intermittently answering to guarantee ideal execution as endorsed will assist the organization with staying away from superfluous dangers, for example, managerial authorizations, business suspension, punishments that could affect the business.

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.

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

Set up Joint Stock Company in Vietnam

Set up Joint Stock Company in Vietnam

Joint Stock Company is an enterprise which has charter capital divided into equal portions called shares. The minimum number of shareholders shall be three and there shall be no restriction on the maximum number.

Shareholders shall be liable for the debts and other property obligations of the enterprise only within the amount of capital contributed to the enterprise.

Joint Stock Companies may issue all types of securities to raise funds. Founding shareholders must together register to subscribe at least twenty per cent (20%) of the number of ordinary shares which may be offered for sale.

The main difference between Joint Stock Company and Limited Liability Company is the Joint Stock Company can raise funds by offering shares or securities.  In addition, an enterprise tends to join the Stock exchanges or public company must be a Joint Stock Company. Management system of Joint Stock Company is more complicated than Liability Company.

ANT Lawyers, a law firm in Vietnam could offer service to set up joint stock company in Vietnam. We assist clients needing legal service in obtaining investment certificate, business registration certificate, or other  licensing procedures.

Read More

Vietnam attends APEC Ministers Responsible for Trade Conference

Vietnam attends APEC Ministers Responsible for Trade Conference

The 27th APEC Ministers Responsible for Trade (MRT) took place online on June 5, 2021 with the participation of 21 APEC member economies and observers including the Association of Southeast Asian Nations (ASEAN), the Asia-Pacific Economic Cooperation Council (PECC) and the Pacific Islands Forum (PIF). Measures to open market will be discussed to facilitate trade and investment, including the smooth policy from Vietnam to support to establish company in Vietnam.

In 2020, due to the impact of the Covid-19 pandemic, the global economy shrank 3.3%. However, because of strong efforts in the introduction of vaccine production and vaccination, financial support programs in some countries, as well as more effective disease containment measures in many countries, this year’s global economy is forecasted to achieve marked improvements compared to 2020. According to a report by the International Monetary Fund (IMF) published in April 2021, the global economy is forecast to reach 6% in 2021 and 4.4% in 2022.

At this meeting, APEC Ministers focused on discussing trade policies to respond to the COVID-19 pandemic. Measures taken include ensuring open markets, promoting the smooth flow of trade in essential goods and services, and facilitating safe and effective vaccine supply chains.

Another important content of the 27th MRT Conference is to support the multilateral trading system, including the progress of implementing reforms of the World Trade Organization (WTO) and updating the progress of negotiations in many fields, such as fisheries subsidies, special and differential treatment, industrial subsidies, market access, agriculture, etc. The APEC Ministers expressed their hope that reform and progress in WTO negotiations will bring positive results, contributing to strengthening the role of the multilateral trading system as well as global and regional economic integration.

At the Conference, the Vietnamese representative also affirmed that Vietnam would actively participate in negotiations and discussions to resolve current issues in the WTO to contribute to the success of the 12th WTO Ministerial Conference. In addition, Vietnam also supports initiatives to promote the movement of goods and services in the region, both to help prevent the epidemic and to develop the economy.

Through the meeting, the participants hoped that in the coming time, in parallel with fighting the epidemic, the parties would also take measures to promote trade and investment to achieve the goal of economic development in the world. Vietnam commits to support the global trade and policy to smooth investment into Vietnam through setting up company in Vietnam.

ANT Lawyers, a law firm in Vietnam could offer service to set up company in Vietnam. We assist clients needing legal service in obtaining investment certificate, business registration certificate, or other  licensing procedures.

Source: ANT Lawyers.vn

 

Read More

How to establish company in Vietnam?

Foreign investors may invest in the form of 100% capital to establish company in Vietnam, being limited liability company, joint stock company, partnership company.

 

How to establish company in Vietnam

Foreign investors that invest in Vietnam for the first time must have investment projects and fill in investment registration or examination procedures at state agencies in charge of investment in order to be granted investment registration certificates. Investment certificates shall concurrently be business registration certificates. Company with 100% foreign capital has founded and operated from the date of issuance of the investment certificate.

A project dossier for establishing 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.

The establishment of a company in Vietnam would take from 30 days. The extra time might be needed in case the investment area is conditional or the State government needs to examine the investment project. Minimum capital, special licenses or other conditions might be required in certain investment projects.

With highly professional staff and great experience in foreign investment, ANT Lawyers would like to support you in establishing company in Vietnam.

ANT Lawyers, as a reliable law firm in Vietnam, we focus on providing possible solutions that best meet the needs of legal and business clients. We help customers achieve their goals while protecting their interests, minimizing risks, and complying with the law.

Source ANTLawyers: https://antlawyers.vn/library/establish-company-in-vietnam.html

Read More

How to Set-up Travel Services Business in Vietnam?

How to Set-up Travel Services Business in Vietnam?

Foreign investor could only set-up joint venture with Vietnam travel agency to set-up travel services business in Vietnam because transport of passenger belongs to investment areas with conditions applied to foreign investor in Vietnam.

10 Questions to Ask Before Setting up Company in Vietnam?

No one could deny that information technology has tremendously changed the way travel services business operates. The use of booking reservation system application on smartphone and internet are widespread that make travel has never been easier.  Foreign investor would be interested to explore the travel services market. However, 100% foreign owned company is not allowed to set-up travel services business in Vietnam. As this investment area is conditional, it is advised that a law firm in Vietnam should be consulted to ensure compliance with local regulations.

The application process and documents requirements are briefly as following:

1. Required documents:

-Application for the International Travel Business License (form);

-Certificate of business registration (copy – certified)

-Business plan for the international travel agency;

-Tour schedule

-Proof of at least 4 years of experience in international travel business operations

-Certified copies of the tourist guides’ cards whereby at least 3 international tourist guides are required

-Confirmation of bank deposit (as per regulations);

-Proof of office premises or legally registered place of business

2. Business License Application Procedure

-Submission of the required documents to the correct authority (Department of Culture, Sports and Tourism of the province/city where the business is headquartered).

-The Department of Tourism of the province/city completes the records of appraisal and submits a written request with the agency’s records to the Ministry of Culture, Sports and Tourism in Vietnam within ten working days from the date of receipt of a valid application. When cases are not eligible for the proposed permit to the state agencies, the provincial tourism department shall cite the specific reasons for refusal. 

-The state management agency of tourism (VNAT – Ministry of Culture, Sports and Tourism) is responsible for reviewing and licensing the international travel business within ten working days from the date of both receipt of the file and written request of the state agency of tourism in the province. In case of refusal, the ministry shall state the specific reasons to the state and provincial tourism authorities

3. Number of records

-Submission to the Department of Culture, Sports and Tourism: 01

-Tourism Authority Filed in: 01

ANT Lawyers, a law firm in Vietnam could offer service to establish company in Vietnam. We assist clients needing legal service in obtaining investment certificate, business registration certificate, or other  licensing procedures.

Read More

The Development of Renewable Energy in Vietnam

The Development of Renewable Energy in Vietnam

On June 15th, 2020, at the National Assembly’s socio-economic discussion session, the Ministry of Industry and Trade clarified a number of issues related to the implementation of power projects and energy security in Vietnam amid the the situation of energy supply, especially electricity supply is facing many difficulties when hydroelectric and thermal power reserves are almost fully exploited and the risk of energy import is increasing.

Vietnam has the advantage of being an equatorial country, with high annual sunshine hours (average from 1800-2600 hours/year) which is an advantage to develop solar energy. Vietnam has a long coastline (3260 km) and favorable terrain, the construction of wind power stations is a solution that can help improve Vietnam’s electricity output in the next years.

As reported by the Ministry of Industry and Trade, for solar power, the total planned capacity of about 10,300 MW has been operated on 90 solar power projects with a total capacity of about 5,000 MW. For wind power, as proposed by the Ministry of Industry and Trade, the Prime Minister has agreed to supplement the planning of an additional 7,000 MW of wind power, raising the total scale of wind power capacity planned to 11,630 MW.

In addition, according to Vietnam’s commitment at COP21, Vietnam will reduce the greenhouse gas emissions by 8% by 2030. And with effective support from the international community, Vietnam can cut its emissions by 25% greenhouse gas emissions by 2030. And the Clean energy technology is one of the best solutions to fulfill this commitment.

In addition, the installation, operation and maintenance of wind and solar power systems are relatively simple, at low cost therefore will save time and cost for investors. Besides, clean energy does not cause impacts on large-scale migration environment, such as deforestation, emissions of dust, water and ash, etc. In contrast, it also creates beautiful and majestic landscapes, and attractive to visitors, this is in line with Vietnam’s sustainable development goals in the future.

With economic and environmental advantages, the scientists forecast that, in the world to 2040 and 2050, the percentage of solar power capacity in total generating capacity will be 45% and 50 %; The structure of electricity production by 2050 is as follows: Number 1 is solar power: 35.8%; followed by onshore wind power: 24.3%; Offshore wind power: 12.1%; Hydroelectricity: 12.4% and the rest are other sources of renewable energy and fossils and nuclear: 15.4%.

In order to ensure the implementation of the overall plan for the coming time, the Ministry of Industry and Trade is focusing on speeding up the construction of the electricity Planning No. VIII to submit to the Government in the fourth quarter of 2020. In particular, following the contents of the Resolution No. 55-NQ/TW of the Politburo on “Vietnam’s national energy development strategy orientation to 2030, vision to 2045” on February 11th, 2020, according to which ratio of sources of renewable energy in the total primary energy supply will reach about 15-20% by 2030; 25-30% by 2045.

According to Resolution No. 55-NQ/TW, Vietnam will develop breakthrough mechanisms and policies to encourage and promote the renewable energy sources in order to replace fossil energy sources at maximum. Prioritizing the use of wind and solar energy for electricity generation; encourage investment in building power plants using urban waste, biomass and solid waste in parallel with environmental protection and economic development of the circulation. To establish and develop a number of renewable energy centers in advantageous regions and localities. Then researching and assessing the overall potential and developing development orientations for geothermal energy, ocean waves, tides and ocean currents; deploy a number of application models, conduct pilot tests to evaluate the effectiveness. To undertake technological research, formulate a number of production pilot projects and encourage the use of hydrogen energy in line with the general trend of the world. In addition, the Resolution prioritizes the development of renewable energy in line with the ability to ensure system safety with reasonable electricity costs and encourage the development of rooftop and surface solar power. To develop groundbreaking support policies and mechanisms for offshore wind power development in association with the implementation of the Vietnam’s Sea Strategy.

With advantages and priority policies for renewable energy development as above, Vietnam hopes that more international investors will invest and set up company in Viet Nam in renewable energy.

Read More

10 Questions to Ask Before 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.

10 Questions to Ask Before Setting up Company in Vietnam

Before setting up company 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 special cases when export tax is larger than 0. Import tax varies according to tariff. Value added tax is mostly at 10% however in some cases, VAT could be 5% or 0%. Personal Income tax varies according to income level and is applicable from VND 9,000,000 above.

10. What are mandatory reports submissions requirement in Vietnam?
Companies are required to keep accounting books, prepare and submit tax reports on monthly, quarterly and annually. Foreign companies are also required to have financial audit taken before the financial year end. The financial year in Vietnam is from January to December and the deadline to submit financial report is March 30th for the previous year. Other reports are required to be submitted at other State agencies.

With highly professional staff and great experience in business in Vietnam, ANT Lawyers would like to support you in establishing company in Vietnam.

Source ANTLawyers: https://antlawyers.vn/library/10-questions-to-ask-before-setting-up-company-in-vietnam.html

Read More