Company Registration in Vietnam
I would like to expand my business to Vietnam. Can I set up a company there as a foreigner?
Yes, foreign citizens are entitled to expand to Vietnam and incorporate a foreign-owned company in the country. However, there are certain restrictions and 100 % Foreign Invested Enterprise in Vietnam can be started only in the form of Limited Liability Company (LLC) or Joint Stock Company (JSC). Depending on the type of business entity you want to pursue, there are further regulations for foreigners to follow when establishing a company in Vietnam.
Is there any option how to expand my business without incorporating a company in Vietnam?
Yes, there are several options suitable for investors who wish to expand without forming a legal entity.
HR Outsourcing
Engage Cekindo in your expansion, and relocate your staff or hire Vietnamese professionals without incorporating a legal entity. Cekindo will act as an Employer of Record (EOR), provide recruitment, payroll, business visas and work permits.
Local Distributor
Market your product in Vietnam through a local distributor. Cekindo will take care of shortlisting potential traders in Vietnam, and arrange meetings between them and your company.
The main advantage for you is that you do not need to be physically present in Vietnam during the selection and negotiation part.
What are the company types in Vietnam?
The most common company types are Limited Liability Company known as LLC and Joint Stock Company known as JSC. Both types are suitable for foreigners with an LLC being recommended to smaller companies with a few owners while a JSC better fits big businesses or those that plan to go public.
What are the benefits of a local nominee company and shelf company?
Both local nominee company and shelf company represent fast ways how to incorporate a legal entity and penetrate the Vietnamese market successfully.
A local nominee company is established through a nominee agreement with a trustworthy local partner such as Cekindo. In this case, the company is considered as a local company, requirements for its establishment are not that strict, and it takes around 10 working days to incorporate a local company in Vietnam.
A shelf company is a previously established business with zero business activity and transactions. Investors who purchase a shelf company can start their business operations almost immediately.
Will I be able to hold 100 percent ownership of a foreign-owned company?
Most probably yes. The Vietnamese law enables foreigners to open foreign-owned companies in most business sectors except for six business fields mentioned in the Negative List, namely
- Drugs and narcotics,
- Hazardous chemicals and minerals,
- Range of specimens of endangered flora and fauna,
- Prostitution,
- Human trafficking, sale of human body parts and tissue,
- Human cloning or asexual reproduction.
Is there any minimum capital required prior to company registration in Vietnam?
Although the local law does not stipulate the minimum capital, 10,000 USD is commonly considered as the minimum capital investors should prove during the registration.
I want to set up my company as soon as possible, is there some way to speed up the registration process?
The process of starting an LLC or JSC in Vietnam takes approximately 1 to 3 months. In case, you wish to open a business as soon as possible, we recommend purchasing a shelf company from Cekindo. As such we can transfer the management control to you within a few working days.
I would like to set up a local company, but I do not have a reliable local partner to act as the shareholder. What should I do?
Underestimating the role of a business partner or local nominee are one of the common business mistakes in Vietnam. Choosing a reliable local partner for your company is key to success in the country while reducing the potential risks.
Cekindo offers local nominee services without any interventions to your business processes. We also allow our partners to terminate the contract sooner that its expiry date.
VISA in Vietnam
Is it possible to use a business visa to work in Vietnam?
The term “business visa” gets tricky in the Vietnamese context. In Vietnam, there are several kinds of visas that might be used for business purposes, and their requirements, validity and conditions differ.
As a rule of thumb, a Business visa ( or DN visa) is sponsored and applied by a Vietnam – based company to invite and sponsor for foreign experts to work for or work with such sponsoring company within a short-term (normally 03 months of validation for a business visa).
You can find more information on business visa types here.
Is it easy to obtain a business visa or working permit?
This depends on several factors such as your country of origin, previous working experience, a position you apply for, and aspecially the company which sponsors for your business visa and work permit that you work for when entering Vietnam. However, the process will be smoother with the assistance of a professional visa partner with a vast network of contacts in Vietnam.
Who can be a visa sponsor?
Again, this depends on the kind of visa you apply for. Business visas and work permit should be sponsored by the employer who you will work for in Vietnam while agencies can sponsor an Invitation Letter for a tourist visa.
Finance
My company has been established but currently does not have any activities, should I report the company’s taxation?
After your company is established, it is mandatory to submit monthly and annual reports even if you do not have any business activities and zero taxes.
Is there any obligation regarding company payroll?
In Vietnam, there are three types of employee insurances available
- Health Insurance (HI)
- Social Insurance (SI)
- Unemployment Insurance (UI)
In general, domestic workers are subject to higher taxes than foreign workers who are only eligible to some of these insurances.
For further information, check Payroll Obligations in Vietnam in 2019.
What are the deadlines for annual tax return?
The deadline for both the corporate income tax as well as individual tax returns is on 31st March.
Product Registration
My company is planning to distribute products in Vietnam, what are the regulations that we need to consider?
Prior to distributing your product in Vietnam, you will have to register them at an adequate authority based on the kind of imported products. As only a Vietnamese legal entity can register products, you will need to find either a reliable local distributor or set up a foreign-owned company.
Is it safe to register the product under a local distributor?
Yes and no. It is very important to choose a reliable distributor because he/she will register the product under their company and become the product licence holder as well as the import licence holder.
We offer undername import services and thus registering your product under Cekindo. In this case, you do not need to worry about the trustworthiness of this deal. Furthermore, Cekindo does not request the right of exclusivity, so you are allowed to have more sub-distributors.
What are the commonly imported products in Vietnam?
Cekindo’s clients usually request registration of products from the following categories:
