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One of the fastest-growing economies

In South-East Asia

Why should I invest in Vietnam?

Vietnam's GDP has been growing at an impressive rate over the last decade, positioning the country as one of the fastest developing economies in the world. This positive trend allowed Vietnam to become a middle-income country with a population of nearly 100 million people, placing it as one of the most populated countries among the Southeast Asian nations.  Moreover, from a geographical perspective, Vietnam surely benefits from being a close neighbour of China the world’s largest manufacturing country. 

As average wages keep increasing in China, Vietnam becomes the natural substitute country for those companies seeking lower costs of production while simultaneously securing proximity to China’s supply chain and logistic infrastructure.

Download our Vietnam Business Guide

How can I set up a Company in Vietnam?

Limited Liability Company

A limited liability company is a legal entity established by capital contribution from its members which is treated as equity (or charter capital). A limited liability company is not allowed to issue shares. The total number of members in a limited liability company is restricted to 50.

A liability company may be established by foreign investors in either one of the two following forms:

1° - A 100% foreign-owned enterprise (where all members are foreign investors) or

2° - A foreign-invested join-venture enterprise with at least one domestic investor

Joint-stock company

A joint-stock company is a legal entity established by its founding shareholders on the basis of their subscription of shares of the joint-stock company. The charter capital of a joint stock company is divided into shares and each founding shareholder holds a number of shares corresponding to their subscribed and paid-up shares in the joint stock company.

A joint-stock company is required to have at least three shareholders (with no maximum number of shareholders). A joint- stock company may take the form of either (cf. 1° LIMITED LIABILITY COMPANY) 100% foreign- owned; or (cf. 2° LIMITED LIABILITY COMPANY) a joint venture between foreign and domestic investors.

Branch

A foreign company may set up a branch office in Vietnam.

This form of foreign direct investment is only permitted in a few sectors (e.g. banking, education or law firms).

A branch is a part of a foreign company that does not have its own legal personality, although it is permitted to conduct business activities in Vietnam. The head office is fully liable for the activities of its branch.

Representative Office

A foreign company also may set up a representative office (RO). A representative office may not engage in any commercial activities and does not have the status of a separate legal entity. It may carry out marketing and promotional activities for the head office, act as a liaison office and/or import goods for marketing and promotion.

Set up Procedures

Company set up procedures

01

Location Selection

02

IRC + IERC Application

03

Seal Application

04

Public Notifications

Representative Office set up procedures

01

Location Selection

02

RO/Branch Application

03

Seal&Taxcode Application

04

Public Notifications


Tax framework in Vietnam

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 The Vietnamese tax system is comprised of the followings:

  • Corporate Income Tax (CIT)
  • Personal Income Tax (PIT)
  • Value Added Tax (VAT)
  • Foreign Contractor Withholding Tax (FCWT); and
  • Others (i.e. Special Sales Tax, Import & Export Duties Natural Resources Tax, Property Taxes, Environment Protection Tax, Business License Duty & Registration fee)

 

 

 

 

 

 

Disclaimer: illustrative; percentages based on latest applicable regulation at the time of publishing; information provided do not substitute professional advice from our consultants.


Employment

How can I employ staff within my company in Vietnam?

As a member of WTO and FTA being initiated Vietnam is in urgent domestic and international demand for the incorporation and implementation of international labour
standards. Protection wise there is no distinction between foreigners with a local labour contract and Vietnamese employees. Indeed, the general rule is, that foreigners working in Vietnam must comply with Vietnamese Labour Law.

Regarding labour contracts, three types of labour contract are available: (i) seasonal labour contract (under 12 months); (ii) definite labour contract (12 – 36 months) and (iii) indefinite labour contract.

How can I onboard foreign staff in my Vietnamese company?

All foreign individuals require a Work Permit issued by the Department of Labour, Invalids and Social Affairs (DOLISA) in order to undertake any employment in Vietnam.

Work permits are issued for a maximum period of 2 years and may be renewed if certain conditions are met.

How much does an employee cost?

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Disclaimer: illustrative; percentages based on latest applicable regulation at the time of publishing; information provided do not substitute professional advice from our consultants.

Operations & Locations

How can I finance my operations?

Cross-border financial transactions between foreign-invested companies (FICs) in Vietnam and foreign entities are strictly regulated by the State Bank of Vietnam (SBV).

How can I find the correct location for my investment?

In Vietnam you can find Industrial Parks (IPs), Economic Zones (EZs) and Export Processing Zones (EPZs). Since the implementation of the Đổi Mới (economic rejuvenation) policy in 1986, the government of Vietnam has been encouraging foreign investments into the country by creating favourable legal environment and infrastructure.

Choosing a suitable Industrial Park

To guarantee competitiveness and secure production within a work friendly environment, it is crucial to choose your Industrial Park well. Here are the main economic zones in Vietnam.

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