Conditions & procedures for foreigners to open a company in Vietnam

Can foreigners set up a company in Vietnam? What are the investment conditions for foreign investors? What is the process of opening a foreign company? Let’s refer to the following article with fdiinvietnam.com

Conditions for foreigners to establish a company in Vietnam

1. Subject conditions

Foreigners are allowed to establish a company in Vietnam when:

 

2. Industries and professions not allowed to invest in business in Vietnam

Currently, there are many business sectors that have restrictions that do not allow foreigners to participate in business activities. 

>> See details: List of industries and occupations that are not yet accessible to foreign investors.

For example: 

• Enterprises established by foreigners will not be allowed to conduct business in sending workers to work abroad under contract (labor supply);
• Foreigners are not allowed to conduct business in inspection and certification services for means of transport.

3. Market access conditions for foreign investors

•  Establishing a foreign company in Vietnam must comply with commitment 318/WTO/CK corresponding to the scope of activities and business services of Vietnam;.
• If the investment industry or profession is on the list of industries or professions with restricted market access for foreign investors, it must satisfy the legal conditions (regarding the ratio of charter capital ownership of foreign investors in economic organizations; investment forms; scope of investment activities, etc.) to conduct business activities.

For example : 

Packaging printing services belong to other business service sectors, with restrictions on charter capital ownership ratio and investment forms, specifically:

• Ratio of charter capital ownership of foreign investors in economic organizations: not exceeding 51%;
• Investment form: joint venture.

Construction works in the construction service industry have restrictions on subjects and scope of activities, specifically:

• Foreign investors: must be a legal entity of a WTO member or of an ASEAN member country;
• Scope of activities: construction of high-rise buildings, construction of civil engineering works, installation and completion work, finishing work of high-rise buildings, other construction works.

Refer to the detailed market access conditions for foreign investors at the National Information System on Foreign Investment. 

Procedures for establishing a foreign-invested company in Vietnam

There are 2 ways to open a foreign company in Vietnam:

• Method 1: Establish a company with Vietnamese capital and then transfer it;
• Method 2: Establish a company with foreign capital directly from the beginning.

 

1. Procedures for opening a company with Vietnamese capital and then transferring it

The process of establishing a foreign company with Vietnamese capital and then transferring it includes the following steps:

Step 1: Register to establish a company with 100% Vietnamese capital;

>> See more: Conditions, procedures, application forms and how to register to establish a company.

Step 2: Carry out procedures to transfer capital to foreigners.

>> See more: Procedures for transferring capital contributions to foreigners.

2. Procedures for establishing a company with direct foreign capital

To open a company with 100% foreign capital from the beginning, you perform the following steps:

Step 1: Apply for investment certificate for foreigners;

>> See more:  Procedures for granting investment certificates to foreign investors.

Step 2: Register to establish a company or business.

If customers do not have enough experience or want to speed up the procedure, they can refer to the service at fdiinvietnam.com. 

Refer to the articles:

>>  Service of establishing foreign-invested companies;

>>  Company and business establishment services.

Or call fdiinvietnam.com for free consultation and fastest information.   

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Notes when foreigners open a company in Vietnam

When foreigners open a company in Vietnam, regardless of the form of establishment chosen, they need to pay attention to certain requirements.

1. For foreign companies transferring capital from Vietnamese people

• If it is a joint stock company, the transferring individual must submit a personal income tax declaration to the tax authority within 10 days from the date of transfer. At the same time, pay personal income tax of 0.1% on the transfer value;
• If it is a limited liability company, the transferring individual only needs to submit a personal income tax return within 10 days from the date of completion of the transfer. 

2. For companies with 100% foreign capital directly from the beginning

• If a foreign company needs to distribute retail, it must apply for a license issued by the Ministry of Industry and Trade;
• After establishment, the company must open an investment capital account for investors to deposit their capital contributions.

In addition, you can refer to the note 7 things to do immediately after establishing a company or business.

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