Lưu trữ Information

29/03/202329/03/2023

THINGS TO NOTE WHEN CONTRIBUTING CAPITAL BY LAND USE RIGHTS

I. Conditions for capital contribution by land use rights

Land users may exercise the right to contribute capital by land use rights when the following conditions are met:

- Have a land use right certificate, except for the following cases:
- In case all recipients inheriting land use rights, ownership of houses and other assets attached to land are foreigners or overseas Vietnamese who are not eligible to buy housing associated with land use rights in Vietnam:
  - The heirs may not be granted a Certificate of land use rights, ownership of houses and other property attached to the land but is transferred or gifted to the inherited land use right.
  - In case of inheritance of land use rights, land users may exercise their rights when they have a certificate or are eligible to issue certificates of land use rights, ownership of houses and other assets attached to land.
- The land is not in dispute;
- Land use rights are not marginalized to ensure the execution of judgments;
- During the term of land use.

The conversion, transfer, lease, sub-lease, inheritance, gift, mortgage of land use rights, capital contribution by land use rights must be registered at the land registration office and take effect from the time of registration in the cadastral book.

II. Conditions for receiving capital contribution by land use rights

Economic organizations, households and individuals may transfer, receive capital contributions, or lease agricultural land use rights for the implementation of non-agricultural production and business investment projects when they fully meet the following conditions:

- There is a written approval from a competent state agency for an economic organization to transfer, receive capital contribution or lease the right to use agricultural land for the implementation of the project;
- The purpose of use for the land area to be transferred, contributed capital or leased land use rights must be in accordance with the land use planning and plan approved by a competent state agency;
- For land specialized in rice cultivation, it must comply with the provisions of Clause 3, Article 134 of the 2013 Land Law as follows:
  - Persons who are allocated or leased land for non-agricultural purposes by the State from land specialized in rice cultivation must pay a sum of money for the State to supplement the lost land area for rice cultivation or increase the efficiency of using rice land according to the Government’s regulations.

III. Dossier of capital contribution by land use right

Application for registration of land fluctuations or houses associated with land use rights according to form No. 09/DK.

Contracts and documents on capital contribution by land use rights, ownership of assets attached to land (original).

Certificate of land use rights or houses associated with land use rights (original).

Written approval of competent State agencies for economic organizations receiving transfers, capital contributions or leases of agricultural land use rights for the implementation of investment projects;

The land user’s written consent for the owner of the property attached to the land to contribute capital to the property attached to the land in case the capital contribution is equal to the property attached to the land but the owner of the property attached to the land is not simultaneously a land user.

IV. Procedures for capital contribution by land use rights

Order of execution:

Step 1: Valuation of land use rights. Valuation of land use rights or houses associated with land use rights can be set by shareholders, company members and jointly responsible or hired by professional valuation companies.

Step 2: Sign a capital contribution contract with land use rights and perform notarization at a notary office. The parties sign capital contribution contracts (specifying the time limit for capital contribution by land use rights) and carry out notarization procedures at the notary office.

Step 3: Register fluctuations in land use rights, ownership of assets attached to land in case of capital contribution by land use rights, ownership of assets attached to land.

Step 4: Register to change charter capital/investment capital according to the information contributed to relevant authorities.

In case of capital contribution by land use rights to establish a company, individuals/organizations shall carry out procedures within 90 days from the date of obtaining the enterprise establishment license.

In case of additional capital contribution, the charter capital of the established individual/organization shall carry out the procedures from the date of signing the capital contribution contract.

The registration agency for capital contribution to economic organizations is the land registration office at the provincial Department of Natural Resources and Environment or the agency receiving the dossier as prescribed by the People’s Committee of the province or centrally run city.

Tax provisions when contributing capital by land use rights:

- Registration fee: Free registration fee due to capital contribution by land use rights.
- Personal income tax: 2% on the transfer or sublease price. Accordingly, individuals who contribute capital by land use rights and real estate do not have to declare and pay PIT immediately. Only after one of the acts such as capital transfer, capital withdrawal, dissolution of the enterprise will this obligation be fulfilled.

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25/11/202225/11/2022

LABOR DISPATCH BUSINESS LINES OF FOREIGN BUSINESSES

I. Definition of labor dispatch sector

According to Article 52 The Labor Code 2019:

Labor dispatch is defined as an act in which an employee enters into an employment contract with a labor dispatch agency whereby an employee is assigned to work under management of another employer while maintaining a labor relationship with an employer with whom the employment contract was signed.

Labor dispatch is:

- A conditional sector
- Only be conducted by businesses which have Labor dispatch licenses
- Only apply to some particular types of work

Provisions of labor dispatch is stipulated in Section 5 Chapter III The Labor Code 2019 and Decree 145/2020/ND-CP.

II. Does the foreign investor have the ability to conduct labor dispatch activities in Vietnam?

According to Annex IV Decree 31/2021/ND-CP, Labor dispatch is a conditional sector thus investors have to consider the market access conditions applied to foreign investors which are stipulated in international treaties that Vietnam is a member. However, the labor dispatch sector is not currently stipulated in WTO, FIAs’ commitment. Therefore, foreign investors who are planning to conduct labor dispatch activities in Vietnam shall have the approval of The Ministry of Planning and Investment, The Ministry of Sector Management.

III. Conditions of conducting labor dispatch of foreign businesses

In order to conduct labor dispatch activities in Vietnam, the business shall have the approval of The Ministry of Planning and Investment, The Ministry of Sector Management and investment project which has been issued an Investment Registration Certificate (IRC). In addition, according to Article 12 Decree 145/2020/ND-CP, foreign businesses also have to fulfill following conditions:

– The foreign business is established under The Enterprise Law;

– The foreign business is issued The Labor dispatch license;

– The foreign business recruits, enters into contracts with employees before assigning them to work under management of another employer while maintaining labor relationships with an employer with whom the employment contract was signed;

– Conducting in the granted sector which is stipulated in Annex 2 Decree 145/2020/ND-CP.

IV. License for conducting labor dispatch

*Conditions for licensing

About the representative: the business’s representative conducts labor dispatch activities shall meet following conditions:

– Being the representative according to provisions stipulated in Enterprise Law;

– Having no Criminal record;

– Having directly worked as specialists or managers in labor dispatch or labor supply for 03 years (36 months) or more within 05 consecutive years before applying for license.

About the business: foreign business has made a deposit of 2.000.000.000 VND (two billion VND)

*Dossiers of application for a license

– The business’s written application for a license;

– The curriculum vitae of the legal representative or the judicial record card in the country of nationality;

– Documents proving the period of direct work as a specialist or a manager in labor dispatch of a business’s representative;

– Certificate of deposit for labor dispatch activities.

Note: The judicial record shall be issued no more than 06 months from the date of the application submission. The judicial record, Proving documents in foreign language shall be translated into Vietnamese, authenticated and consular legalized in accordance with law

*Cases in which license are not granted

– Fail to meet the licensing conditions;

– Use a fake license to conduct labor dispatch activities;

– Have a legal representative who used to be a representative of a business whose license has been revoked for the reasons specified at Points d, đ and e, Clause 1, Article 28 of this Decree for 05 consecutive years immediately before applying for a license for labor dispatch;

– Have a legal representative who used to be a representative of a business using a fake license.

V. Procedures of licensing

Step 1: The business shall submit an application for a license to the Department of Labor, War Invalids and Social Affairs where the enterprise’s headquarter is located to apply for a license.

Step 2: After considering valid documents, the Department of Labor, War Invalids and Social Affairs shall issue a receipt clearly stating the date, month and year of receipt of the application for a permit

Step 3: Within 20 working days from the date of receipt of the secured application as prescribed, the Department of Labor, War Invalids and Social Affairs shall verify and submit it to the Chairman of the provincial People’s Committee for issuance of a license to the enterprise.

In case the dossier is not secure as prescribed, within 10 working days from the date of receiving the dossier, the Department of Labor, War Invalids and Social Affairs shall send a written request to the business to complete the dossier.

Step 4: Within 07 working days from the date of receiving the dossier submitted by the Department of Labor – Invalids and Social Affairs, the Chairman of the provincial People’s Committee shall consider and grant the license to the business; in case the license is not granted, the business shall be receipt documents stating the reason for not granting the license.

*Competent authority for licensing

The Chairman of the People’s Committee of the province where the business’s headquarter is located has the authority to grant, extend, re-issue and revoke license for businesses.

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17/11/202217/11/2022

CASES OF VAT REFUND

No.	Case of VAT refund	Legal Basis
1	A business establishment that pays VAT using credit-invoice method may offset input VAT that remains after deduction in the month or the quarter against VAT incurred in the next period. Where a business establishment has registered to pay VAT using credit-invoice method has a new investment project which is still in its investment stage, VAT on goods/services purchased serving the investment has not been deducted, and the remaining tax is at least VND 300 million, VAT shall be refunded.	Clause 3 Article 1 Law No. 106/2016 amending and supplementing a number of articles of the Law on Value Added Tax, the Law on Special Consumption Tax and the Law on Tax Administration
2	In a month (in case of monthly declaration) or quarter (in case of quarterly declaration), if the input VAT on exported goods/services (including goods that are imported and subsequently exported to non-tariff areas and the goods that are imported and subsequently exported to other countries) of a business entity remains at least VND 300 million after being offset against, it shall be refunded by month or quarter. If such input VAT is less than VND 300 million, it shall be offset against in the next month/quarter. In case a business establishment has both exported goods/services and goods/services sold domestically and input VAT on exported goods/services that remains at least VND 300 million after being offset against tax payable, it shall be refunded. Input VAT on purchases used for manufacturing of exported goods/services shall be separately recorded. Otherwise, input VAT shall be determined according to the ratio of revenue from exported goods/services to total revenue from goods/services accrued from the tax period succeeding the period in which tax is refunded to the current period in which tax refund is claimed.	Clause 3 Article 1 Law No. 106/2016 Clause 3 Article 1 Decree No. 146/2017/NĐ-CP
3	Business establishments which pay value-added tax according to the tax credit method are entitled to value-added tax refund if upon ownership transformation, enterprise transformation, merger, consolidation, separation, split, dissolution, bankruptcy or operation termination, they have an overpaid value-added tax amount or have some input value-added tax amount not yet fully credited.	Clause 3 Article 13 Value added tax Law
4	Business establishments that have registered for business and value-added tax payment according to the tax credit method (including newly established business establishments from investment projects), have new investment projects (including investment projects divided into several investment phases or investment categories) according to regulations of the Law on Investment in areas of the same or different provinces and cities where their headquarters are located (except for cases prescribed in Point c of this Clause, investment projects on construction of houses for sale, and investment projects that do not create fixed assets) that are in the investment phase or projects on prospection and projects to search, prospect, and develop oil and gas fields that are in the investment phase, and have the input value-added tax of goods and services incurred during the cumulative investment phase that have not been fully deducted from at least 300 million VND, shall be eligible for the value-added tax refund.	Decree No. 209/213/NĐ-CP

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10/11/202210/11/2022

NOTES ON TAXES WHEN IMPORTING LARGE DISPLACEMENT MOTORCYCLES

No.	Contents	Legal Basic
1	Import tax: 75%	Decree 122/2016/ND-CP
2	Special Consumption Tax: Two-wheeled motorcycles, three-wheeled motorcycles with a cylinder capacity of more than 125 cm3: 20%	Article 7 Law on Special Consumption Tax Amended in 2016
3	Value Added Tax: 10%	Value Added Tax Law 2008
4	Automatic import license: REMOVE this regulation. "Traders importing large displacement motorcycles of 175cm3 or more do not have to register for automatic import license at the Ministry of Industry and Trade, just need to carry out import procedures at the customs office according to current regulations".	Circular No. 27/2018 of the Ministry of Industry and Trade

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06/09/202206/09/2022

ENTERPRISE SHOULD CHOOSE DISSOLUTION OR BANKRUPTCY

I. Legal basis

Enterprise Law 2020
Bankruptcy Law 2014

II. Differences between dissolution and bankruptcy

Similarity:

_ First, the enterprise terminates its operation after dissolution or bankruptcy.

_ Second, the seal and certificate of business registration shall be revoked.

_ Third, enterprise must fulfill property obligations and pay debts when carrying out procedures for dissolution or bankruptcy.

Difference:

Criteria	Dissolution	Bankruptcy
Definition	Dissolution of an enterprise is the termination of the existence of an enterprise according to the will of the enterprise or of a competent authority. Law on Enterprises governing dissolution	Bankruptcy is the state of an enterprise that is insolvent and declared bankrupt by the people's court. Bankruptcy Law governing bankruptcy
Features	_ Cases of enterprises being dissolved: a) The expiry of operation term stated in the company's charter without a decision on extension; b) According to resolutions and decisions of the business owner, for private enterprises, of the Members' Council, for partnerships, of the Members' Council, of the company owner, for limited liability companies; , of the General Meeting of Shareholders, for joint-stock companies; c) The company no longer meets the minimum number of members as prescribed in this Law for 06 consecutive months without carrying out procedures for transformation of enterprise type; d) The certificate of enterprise registration is revoked, unless otherwise provided for by the Law on Tax Administration. _The condition for an enterprise to be dissolved is to fulfill all financial and debt obligations that the enterprise has established with third parties. _ The dissolution of a business will result in the termination of the company's legal status. _ Business owners and managers are not restricted or prohibited from holding the position of running the business or performing a number of business activities.	_ Insolvency means the enterprise fails to fulfill its debt payment obligation within 03 months from the due date of payment. _ In the process of resolving the bankruptcy case, creditors cannot separate themselves to collect their own debts, but they must all be gathered into a single legal entity, called the creditors' meeting. _ Bankruptcy is not only for debt collection purposes, but also focuses on helping debtors to recover business operations.
Right holder for application	Business owner, members' council, company owner, general meeting of shareholders, all general partners.	_ Unsecured creditors, partially secured creditors; _ Employees, grassroots trade unions, and direct superior trade unions in places where grassroots trade unions have not yet been established; _ The legal representative of the enterprise, the owner of the private enterprise, the Chairman of the Board of Directors of a joint-stock company, the Chairman of the Members' Council of a limited liability company with two or more members, the owner of the company One-member limited liability company, general partner of a partnership company; _ Shareholder or group of shareholders meeting the statutory conditions.
Place of application	Department of Planning and Investment	Court
Restrictions for business managers after termination of operation	No retriction	The person holding the managerial position of the enterprise declared bankrupt may be considered and decided by a judge not to have the right to establish an enterprise or a cooperative or to act as an enterprise manager.
Procedures	_ Approve the decision to dissolve the enterprise; _ Organize the liquidation of assets; _ Send the decision on dissolution of the enterprise to relevant agencies and organizations; _ Notify business status; _ Pay debts of the enterprise; _ Send the dissolution request to the business registration agency.	_ File and receive the petition to open bankruptcy proceedings; _ Negotiate to withdraw the petition to open bankruptcy proceedings; _ Accept the petition to open bankruptcy proceedings due to unsuccessful negotiation; _ Decide to open bankruptcy proceedings when there are grounds to open; _ Organize the creditors' meeting; _ The court declares the company bankrupt; _ Execute the court's decision declaring bankruptcy.

Note:

For companies with foreign investment. Before dissolving the company, investors need to carry out procedures for termination of investment projects.

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28/07/202228/07/2022

FOREIGNERS BUYING HOUSES TO LIVE IN VIETNAM

I. Legal grounds

The Housing Law, No. 65/2014/QH13
Decree No. 99/2015/ND-CP of the Government promulgates the Decree detailing and guiding the implementation of a number of articles of the Housing Law.

Circular No. 19/2016/TT-BXD dated June 30, 2016, of the Ministry of Construction, guiding the implementation of a number of the Law on Housing 2014 and Decree No. 99/2015/ND-CP of the Government

II. Procedures for foreigners to buy houses to live in Vietnam

Entities eligible for the homeownership in Vietnam

According to the provisions of Clause 1 Article 159 of the Law on Housing 2014 allows foreigners to buy houses in Vietnam, specifically the following foreign organizations and individuals:

Foreign entities who invest in project-based housing construction in Vietnam as prescribed in this Law and corresponding regulations of law;
Foreign-invested enterprises, branches, representative offices of foreign enterprises, foreign-invested funds, and branches of foreign banks operating in Vietnam (hereinafter referred to as foreign organizations);
Foreign individuals are allowed to enter Vietnam.

Transactions of legitimate housing

Entities having legitimate housing through the following transactions:

Investment in the construction of houses under projects in Vietnam by the Law on Housing 2014 and the law relevant laws;
Purchase, lease, lease purchase, receipt of a gift, receipt of an inheritance, including apartment buildings and separate houses in housing construction investment projects, except for areas under management relating to national defense and security as prescribed in regulations of the Government.

Consequently, foreign organizations and individuals cannot buy land but can only own commercial housing (including apartment buildings and separate houses) in investment projects built commercial housing, except for areas under management relating to national defense and security as prescribed in regulations of the Government.

Eligible for the homeownership

According to Article 74 of Decree 99/2015/ND-CP guiding the Law on Housing, foreigners who fall into the above categories have the right to buy houses in Vietnam, but to own a house, they must have a valid license. proof sheet.

Case 1: For individuals or organizations investing in housing construction under projects

Have an Investment Registration Certificate;
Have houses that are built under a project as prescribed in this Law and corresponding regulations of law.

Case 2: Conditions for foreign organizations

An investment certificate or documents related to being allowed to operate in Vietnam issued by a competent Vietnamese state agency is still valid at the time of contract signing the house purchase agreement or house lease purchase.

Case 3: Conditions for individuals

Having valid passports stamped with entry verification stamp of the immigration and exit management agency of Vietnam;
Not granted diplomatic immunity and privileges as prescribed.

Foreigners only buy houses in housing construction investment projects and must satisfy all conditions on a case-by-case basis.

Time and percentage of ownership

Article 161 of the 2014 Housing Law specifically stipulates that foreign individuals and organizations may not buy, rent and purchase, receive, inherit and own more than 30% of apartments in an apartment building; or more than 250 houses regarding separate houses including villas, row houses in an area whose population is equivalent to a ward-administrative division. In addition, foreign individuals can own a house for not more than 50 years, from the day on which they are granted the Certificate and they may be also granted an extension as prescribed in regulations of the Government; the duration of the homeownership must be stated in the Certificate.

If a foreign individual marries a Vietnamese citizen or an oversea Vietnamese, he/she qualifies for stable and long-term homeownership and has all rights of a homeowner similarly to Vietnamese citizens;

The foreign organization is eligible for the homeownership as agreed in agreements on housing sale, lease purchase, gifting, or inheritance for no longer than the duration stated in their Certificate of investment, including extension duration, the duration of the homeownership shall be determined from the day on which the organization is granted the Certificate and stated in such Certificate;

Procedures for buying a house

Step 1: Making a Housing agreement

The parties agree to make a written house sale and purchase contract with the main contents based on Articles 120 and 121 of the Law on Housing 2014.

Step 2: Notarization and authentication of a Housing agreement

Step 3: Request to apply for the Certificates

The contracting parties shall agree to choose a party to request the competent agency to grant the Certificate of housing; regarding housing that is bought or leased and purchased from the investor, the investor must complete the procedures for the Certificate issued to the buyer or the lessee by the competent agency, unless the buyer or the lessee wishes to complete the procedures themselves.

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15/07/202207/09/2022

Compare Representative Office with Branch of Enterprise in Vietnam

1. Legal basics

– Article 44, 45 Law on Enterprises 2020.

– Article 31 Decree 01/2021/NĐ-CP on enterprise registration.

– Circular 47/2019/TT-BTC on prescribing the rates of charges for provision of enterprise information and fees for enterprise registration and charge and fee collection, remittance, management and use.

2. Compare Representative Office with Branch of enterprise in Vietnam

Criteria	Representative Office	Branch
Definition	A Representative Office of an enterprise is its dependent unit which acts as the enterprise’s authorized representative, represents and protects the enterprise’s interests. A representative office shall not do business.	A Branch of an enterprise is its dependent unit which has some or all functions of the enterprise, including an authorized representative. The business lines of a branch shall match those of the enterprise.
Dossier	1. A notification of establishment of Representative office/Branch 2. The notarized copy of the resolution or decision and the copy of the minutes of meeting of the Board of Members of the multi-member limited liability company or partnership, or of the General Meeting of Shareholders of the joint-stock company; the copy of the resolution or decision of the owner of the single-member limited liability company on establishment of Representative office/Branch. 3. A notarized copy of the identity card/citizen identity card/passport of the head of the Representative Office/Branch; 4. The notarized copy Enterprise Registration Certificate; Investment Registration Certificate (if applicable).
Quantity of dossier	01
Place of issuance	Business Registration Office at Planning and Investment Department where located the Representative Office address of Company.
Order of processing	Step 1: Submit application for establishment of Representative Office/Branch at the Business Registration Office where the Representative Office/Branch is located through the National Portal on Business Registration (https://dangkykinhdoanh.gov.vn). Bước 2: Business Registration Office shall issue Representative Office/ Branch Registration Certificate (if the documents are valid). If the documents are invalid, Business Registration Room shall notify in writing the contents that need to be amended or supplemented to the enterprise.
Time	03 working days from the date of receipt of valid documents
Stamp	The enterprise shall decide the type, quantity, design and content of its seal and the seals of its Representative office/Branch The management and storage of seals shall comply with the company’s charter or regulations of the Representative office/Branch that owns the seal. Seals shall be used by enterprises in transactions as prescribed by law.
Fee	- Waiver of fee for issuance of Representative Office/ Branch Registration Certificate. - Fee for publication of registered contents of Representative Office/ Branch: 100.000 VND.

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15/07/202218/07/2022

Representative office vs Branch: which one is better for foreign investor in Vietnam

1. Legal basics

- Commercial Law No. 36/2005/QH11 dated 14/06/2005 of The National Assembly
- Decree 07/2016/NĐ-CP dated 25/01/2016 of The Government on detailing the Commercial Law regarding Vietnam-based representative offices and branches of foreign traders.
- Circular 143/2016/TT-BTC dated 26/09/2016 of Ministry of Finance on fees for processing applications for the license to establish representative offices of foreign trade promotion organizations or foreign traders in Vietnam, and the collection and transfer thereof.

2. The issues of granting Representative Office/ Branch Establishment licenses

Criteria	Representative Office	Branch
Conditions to grant license	- The foreign trader has been established or has registered its operation under the law of a country or territory being parties to treaties to which Vietnam is a signatory or is recognized by the aforesaid countries or territories; - In case the foreign trader’s business registration certificate or equivalent paper indicates its term of operation, the remaining term must be at least one year by the date of submission of the application; - Where the scope of operation of the representative office is inconsistent with Vietnam’s Commitments or the foreign trader is not located in the country or territory being party to treaties to which Vietnam is a signatory, the representative office can be established only if relevant Ministers, Heads of ministerial agencies (hereinafter referred to as “relevant Ministers”) have given approval for establishment of the representative office.
	The foreign trader has been operating for at least one year since its establishment or business registration;	The foreign trader has been operating for at least 5 years since its establishment or business registration;
	The scope of operation of the representative office is consistent with that in Vietnam’s Commitments to treaties to which Vietnam is a signatory	The scope of operation of the branch is conformable with Vietnam’s Commitments to market access stipulated in treaties to which Vietnam is a signatory shall be consistent with lines of business of the foreign trader
License term	Representative office/ Branch establishment license shall be valid for 05 years but not exceeding the remaining effective period of the Certificate of Business Registration or the equivalent (for documents having expiry date)
Order of processing	Step 1: Submit the dossier directly, by post or online to the licensing agency of a locality where its representative office/ branch is planned to be located (The provincial-level Industry and Trade Department / the management board for Representative office)/ The Ministry of Industry and Trade (for Branch). Step 2: Within 3 working days after receiving the dossier, the licensing agency shall check and request the applicant to supplement its dossier if it is neither complete nor valid. The request for supplementation to the dossier shall be made only once during the handling of the dossier. Step 3: Within 7 working days after receiving a complete and valid dossier, the licensing agency shall grant to the foreign trader a representative office /branch establishment license or refuse to grant it. In case of refusal, the licensing agency shall issue a document clearly stating the reason.
Dossier	1. An application for a representative office/ branch establishment license. 2. A certified copy of the business registration certificate or equivalent paper of the foreign trader. 3. The foreign trader’s document on appointment of head of the representative office/ branch. 4. Certified copies of audited financial statements or documents proving the fulfillment of tax liabilities or financial obligations in the latest fiscal year or equivalent paper issued or certified by a competent agency or organization of the locality where the foreign trader was established proving the actual existence and operation of the foreign trader in the latest fiscal year. 5. A certified copy of the passport, people’ identity card or citizen’s identity card (for a Vietnamese) or a copy of the passport (for a foreigner) of the head of the representative office/ branch. 6. Documents on the expected location of the representative office/ branch’s office, comprising: - A certified copy of the memo of understanding or location rental agreement or a document proving the right to use the location for opening the representative office/ branch; - A certified copy of the document on the expected location of the representative office/ branch which comply with Vietnamese regulations on security and order, occupational safety and health and other conditions
Dossier		7. A certified copy of the branch’s charter.
Place of issuance	The provincial-level Industry and Trade Department of a locality in which a representative office is scheduled to be located outside industrial parks, export processing zones, economic zones and hi-tech parks The management board of an industrial park, export-processing zone, economic zone or hi-tech park.	The Ministry of Industry and Trade may grant, re-grant, modify, extend or revoke the establishment license and terminate operation of a branch in case the establishment of such branch has not been regulated by any specialized legal document.
Settlement time	- For normal cases: 07 working days from the date of receipt of complete and valid dossiers. - For special cases: 13 working days from the date of receipt of complete and valid dossiers.
Fee	3.000.000 VND
Note	- In case the scope of operation of the representative office/branch is inconsistent with Vietnam’s Commitments or the foreign trader is not located in the country or territory being party to treaties to which Vietnam is a signatory and the case in which the establishment of representative office/ branch has not yet been regulated in any specialized legal document, the licensing agency shall submit a written request for directions to the relevant Ministry before granting or refusing to grant representative office/ branch establishment licenses to foreign trader.

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13/07/202212/10/2022

Limitations on permitted activities of representative offices of foreign traders in Vietnam

Representative office has always been a type of company formation chosen by foreign traders wishing to explore opportunities or expand their business in Vietnam due to its convenience in management and avoidance of the risks arising from local compliance procedures. However, foreign traders should carefully consider restricted activities applied to a representative office in order to avoid legal risks when operating.

I. Legal basics

Comercial Law No. 36/2005/QH11 dated 14/06/2005

Decree 07/2016/NĐ-CP dated 25/01/2016

Decree 98/2020/NĐ-CP dated 26/08/2020

II. What is a representative office of foreign investor in Vietnam?

A representative office of a foreign investor in Vietnam means a dependent unit of the foreign trader, which is established under the provisions of Vietnamese law to conduct market surveys and several commercial promotion activities permitted by Vietnamese law.

III. Permitted activities of representative office

Under Vietnamese law, though the representative office is a dependent unit of its foreign trader, it only plays a supportive role in researching market trends and conducting a number of commercial promotion activities. The representative office does not have actual “business” function; therefore its permitted activities are limited, including:

- Acting as a liaison office;
- Operating for researching and marketing surveys;
- Seeking for and conducting commercial promotion activities, business partners such as entering into contracts with traders conducting commercial advertising activities; directly organizing or participating in trade fairs and exhibitions for the traders that they are representing with valid letters of authorization from foreign traders;
- Renting offices, renting and purchasing equipment and facilities necessary for their operations;
- Recruiting Vietnamese and expatriate employees to work for them; and
- Opening accounts in foreign currencies or foreign currency-based Vietnam dong at banks licensed to operate in Vietnam and to be allowed to use those accounts solely for their operations.

IV. Restricted activities of representative office

Besides conveniences in market research activity, the representative office is forbidden to engage in the following activities:

- Directly conducting profit-generating activities in Vietnam;
- Conducting sale promotions themselves or hiring other traders to conduct sale promotions in Vietnam for the traders that they are representing;
- Directly conducting commercial advertising activities; directly organizing or participating in trade fairs and exhibitions;
- Directly displaying and introducing goods and/or services of traders they are representing, apart from displaying and introducing at representative office.
- Entering into contracts, amending or supplementing contracts already entered into by foreign traders, except where chief representatives obtain valid letters of authorization from foreign traders or other cases such as Renting offices, renting and purchasing equipment and facilities necessary for their operations; Recruiting Vietnamese and expatriate employees to work for them; Opening accounts in foreign currencies for their operations;
- Issuing invoices;
- Providing after-sale-services concerning a service or product provided by foreign traders; and
- Carrying out activities as an agent between a client and foreign traders.

In light of the information above, foreign traders should be cautious when conducting activities through their representative office in Vietnam, especially avoiding letting the representative office carry out profit-generating activities. Carrying out former restricted activities may lead to revocation of the right to use Representative office Establishment license.

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- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

12/07/202218/07/2022

Overview of legal entities in Vietnam

I. Limited liability company

	Single-member limited liability company	Multiple-member limited liability company
General features	- The owner/member of the company is responsible for the debts and other property obligations of the enterprise to the extent of the amount of capital contributed to the enterprise. - The company must not issue shares except for equitization. - The company may issue bonds in accordance with Law on enterprise and relevant laws;
Number of members	An organization or an individual as an owner	There are from 02 to 50 members who are organizations and individuals
Organizational structure	- In case of an individual as an owner: + The company has a President, Director or General Director. + The owner of the company is the President of the company and can concurrently or hire another person to act as the Director or General Director. - In case the organization is the owner: Operating under one of the following two models: + The President, Director or General Director; + Board of members, Director or General Director.	The company has a Board of Members, President of the Board of Members, Director or General Director.

II. Partnerships

* Number of members:

There are least 02 partners (individuals) that are joint owners of the company and do business under the same name. ((hereinafter referred to as “general partner”). There can be limited partners (individuals or organizations) in addition to general partners.

* Limited liability of company members:

– The general partner shall be an individual whose liability for the company’s obligations is equal to all of his/her assets.

– The limited partner can be an organization or an individual whose liability for the company’s debts is equal to the promised capital contribution.

* Organizational structure

The Board of Members consists of all members and shall elect a partner as the President of the Board of Members, who may concurrently hold the position of Director or General Director of the partnership unless otherwise prescribed by the charter.

* Notes:

A partnership must not issue any kind of securities.

III. Joint Stock company

* Number of members:

Shareholders can be organizations and individuals.

* Limited liability of shareholders:

Normally, a joint stock company may choose one of the following models:

– General Meeting of Shareholders, Board of Directors, Board of Controllers and Director/General Director. If the joint stock company has fewer than 11 shareholders and the shareholders that are organizations hold less than 50% of the company’s total shares, a Board of Controllers is not mandatory;

– General Meeting of Shareholders, Board of Directors and Director/General Director. In this case, at least 20% of the members of the Board of Directors shall be independent members and there has to be an audit committee affiliated to the Board of Directors.

* Notes:

– A joint stock company may issue shares, bonds and other kinds of securities.

To save time learning about the law, filling out forms, waiting to submit the dossier, you can contact HT for advice and support for Setting up business in Vietnam.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

29/06/202218/07/2022

List of Industrial Park in Vietnam

I. Industrial park in the North of Vietnam

HANOI	VINH PHUC	BAC NINH	HAI PHONG
1. Thang Long Industrial Park 2. Quang Minh I Industrial Park 3. Quang Minh II Industrial Park 4. Noi Bai Industrial Zone 5. Thach That – Quoc Oai IP 6. Hoa Lac Hi-tech Park 7. Ha Noi – Dai Tu Industrial Park 8. Ha Noi Southern Supporting Industrial Park (HANSSIP) 9. Sai Dong B Industrial Park 10. Bac Thuong Tin Industrial Park 11. Phung Hiep Industrial Park 12. Phu Nghia Industrial Park 13. Tu Liem Hi-Biotechnology Park	1. Thang Long III Industrial Park 2. Ba Thien 2 Industrial Park 3. Binh Xuyen Industrial Park 4. Binh Xuyen II Industrial Park 5. Khai Quang Industrial Park 6. Kim Hoa Industrial Park 7. Tam Duong Industrial Park 8. Tam Duong II Industrial Park 9. Phuc Yen Industrial Park 10. Lap Thach I Industrial Park 11. Song Lo Industrial Park 12. Son Loi Industrial Park 13. Chan Hung Industrial Park	1. VSIP Bac Ninh Industrial Park 2. Dai Dong – Hoan Son Industrial Park 3. Que Vo Industrial Park 4. Que Vo 3 Industrial Park 5. Yen Phong Industrial Park 6. Yen Phong II Industrial Park 7. Que Vo II Industrial Park 8. Tien Son Industrial Park 9. Nam Son – Hap Linh Industrial Park 10. Thuan Thanh Industrial Park 11. Thuan Thanh II Industrial Park 12. Thuan Thanh III Industrial Park 13. Dai Kim Industrial Park 14. Hanaka Industrial Park 15. Gia Binh Industrial Park 16. VSIP II Industrial Park	1. Deep C Industrial Zones 2. Nomura Hai Phong Industrial Park 3. VSIP Hai Phong Industrial Park 4. Trang Due Industrial Park 5. Nam Cau Kien Industrial Park 6. Do Son – Hai Phong Industrial Park 7. An Duong Industrial Park 8. Nam Dinh Vu Industrial Park 9. Vinashin – Shinec (SIP) Industrial Park 10. Trang Cat Industrial Park
HAI DUONG	HA NAM	QUANG NINH	HUNG YEN
1. Phuc Dien Industrial Park 2. Tan Truong Industrial Park 3. Dai An Industrial Park 4. Nam Sach Industrial Park 5. VSIP Hai Duong Industrial Park 6. Cong Hoa – Chi Linh Industrial Park 7. Lai Vu Industrial Park 8. Kim Thanh Industrial Park 9. Phu Thai Industrial Park	1. Dong Van I Industrial Park 2. Dong Van II Industrial Park 3. Dong Van III Industrial Park 4. Dong Van IV Industrial Park 5. Hoa Mac Industrial Park 6. Chau Son Industrial Park 7. Hoang Dong Industrial Park	1. Hoang Bo Industrial Park 2. Cai Lan Industrial Park 3. Dong Mai Industrial Park 4. Hai Yen Industrial Park 5. AMATA city Ha Long (Song Khoai Industrial Park) 6. Viet Hung Industrial Park 7. Hai Ha Industrial Park (Texhong Hai Ha Industrial Park) 8. Hoanh Bo Industrial Park	1. Pho Noi A Industrial Park 2. Pho Noi B Industrial Park 3. Thang Long Industrial Park II 4. Yen My II Industrial Park 5. Nhu Quynh A Industrial Park 6. Nhu Quynh B Industrial Park 7. Minh Duc Industrial Park 8. Ecoland Industrial Park
THAI BINH	YEN BAI	THAI NGUYEN	HOA BINH
1. Tien Hai Industrial Park 2. Phuc Khanh Industrial Park 3. Nguyen Duc Canh Industrial Park 4. Song Tra Industrial Park 5. Gia Le Industrial Park 6. Cau Nghin Industrial Park	1. South Yen Bai Province Industrial Park 2. Mong Son Industrial Park 3. Au Lac Industrial Park 4. Bac Van Industrial Park 5. Minh Quan Industrial Park	1. South Yen Bai Province Industrial Park 2. Mong Son Industrial Park 3. Au Lac Industrial Park 4. Bac Van Industrial Park 5. Minh Quan Industrial Park	1. Luong Son Industrial Park 2. Bo Trai Song Da Industrial Park 3. Yen Quang Industrial Park 4. Mong Hoa Industrial Park 5. Lac Thinh Industrial Park
BAC GIANG	PHU THO	THANH HOA	LANG SON
1. Dinh Tram Industrial Park 2. Quang Chau Industrial Park 3. Song Khe – Noi Hoang Industrial Park 4. Van Trung Industrial Park 5. Viet Han Industrial Park	1. Phu Ha Industrial Park 2. Cam Khe Industrial Park 3. Trung Ha Industrial Park 4. Thuy Van Industrial Park	1. Tay Bac Ga Industrial Park 2. Nghi Son Economic Zone 3. Le Mon Industrial Park	1. Dong Banh Industrial Park 2. Na Duong Industrial Park
NINH BINH	NAM DINH	TUYEN QUANG	HA GIANG
1. Tam Diep Industrial Park	1. Hao Xa Industrial Park 2. Bao Minh Industrial Park	1. Long Binh An Industrial Park	1. Binh Vang Industrial Park
SON LA
Mai Son Industrial Park

II. Industrial park in the Center of Vietnam

NGHE AN	THUA THIEN HUE	QUANG NAM	DA NANG
1. Hoang Mai I Industrial Park 2. Hoang Mai II Industrial Park 3. Nam Cam Industrial Park 4. Bac Vinh Industrial Park 5. Nghia Dan Industrial Park 6. Tho Loc Industrial Park 7. WHA Industrial Zone – Nghe An 8. VSIP Nghe An Industrial Park	1. Phong Dien Industrial Park 2. Phu Bai Industrial Park 3. Tu Ha Industrial Park 4. Phu Da Industrial Park 5. Quang Vinh Industrial Park 6. La Son Industrial Park	1. Dien Nam – Dien Ngoc Industrial Park 2. Thuan Yen Industrial Park 3. Dong Que Son Industrial Park 4. Tay An Industrial Park 5. Bac Chu Lai Industrial Park 6. Tam Anh Industrial Park 7. Tam Thang Industrial Park 8. Tam Hiep Industrial Park 9. Phu Xuan Industrial Park	1. Expanded Hoa Khanh Industrial Zone 2. Lien Chieu Industrial Zone 3. Hoa Khanh Industrial Zone 4. Da Nang Seafood Services Industrial Zone 5. Hoa Cam Industrial Zone 6. The Danang Hi-tech Park 7. Long Hau Hi-tech Factory
QUANG NGAI	QUANG BINH	BINH DINH	PHU YEN
1. Pho Phong Industrial Park 2. Quang Phu Industrial Park 3. Tinh Thong Industrial Park 4. Dung Quat Economic Zone 5. Sai Gon – Dung Quat Industrial Park 6. VSIP Quang Ngai Industrial Park	1. Tay Bac Dong Hoi Industrial Park 2. Cang Bien Hon La Industrial Park 3. Hon La II Industrial Park 4. Bang Industrial Park 5. Cam Lien Industrial Park	1. Phu Tai Industrial Park 2. Long My Industrial Park 3. Nhon Hoa Industrial Park 4. Nhon Hoi Industrial Park 5. Hoa Hoi Industrial Park	1. Hoa Hiep 1 Industrial Park 2. An Phu Industrial Park 3. Dong Bac Song Cau I Industrial Park 4. Dong Bac Song Cau II Industrial Park
QUANG TRI	HA TINH	KHANH HOA
1. Quan Ngang Industrial Park 2. Nam Dong Ha Industrial Park	1. Ha Vang Industrial Park 2. Gia Lach Industrial Park	1. Suoi Dau Industrial Park 2. Ninh Thuy Industrial Park

III. Industrial park in the South of Vietnam

HO CHI MINH	BINH DUONG	DONG NAI	LONG AN
1. Tay Bac Cu Chi Industrial Park 2. Ho Chi Minh City’s Automotive – Mechanical Industrial Park 3. Dong Nam Industrial Park 4. Tan Phu Trung Industrial Park 5. Tan Thoi Hiep Industrial Park 6. Quang Trung Software City 7. Vinh Loc Industrial Park 8. Tan Binh Industrial Park 9. Linh Trung 1 Export Processing Zone 10. Linh Trung 2 Export Processing Zone 11. Binh Chieu Industrial Park 12. Saigon Hi-tech Park 13. Cat Lai 2 Industrial Park 14. Tan Thuan Industrial Park 15. Hiep Phuoc Industrial Park 16. Unika Vie-Pan Rental 17. Phong Phu Industrial Park 18. Tan Tao Industrial Park 19. Le Minh Xuan Industrial Park 20. Anh Ha Industrial Park 21. Xuan Thoi Thuong Industrial Park	1. Bau Bang Industrial Park 2. Rach Bap An Dien Industrial Park 3. Protrade International Tech Park 4. My Phuoc 1 Industrial Park 5. My Phuoc 2 Industrial Park 6. My Phuoc 3 Industrial Park 7. My Phuoc 4 Industrial Park 8. Dong An Industrial Park 9. Dong An 2 Industrial Park 10. Kim Huy Industrial Park 11. Mapletree Industrial Park 12. Phu Gia Industrial Park 13. Dat Cuoc Industrial Park 14. Nam Tan Uyen Industrial Park 15. Song Than 1 Industrial Park 16. Song Than 2 Industrial Park 17. Song Than 3 Industrial Park 18. Dai Dang (De Den) Industrial Park 19. Viet Hung 1 Industrial Park 20.VSIP 1 Industrial Park 21. VSIP 2A INDUSTRIAL PARK 22. VSIP 2B Industrial Park 23. Tan Dong Hiep Industrial Park 24. Tan Dong Hiep A Industrial Park 25. Tan Dong Hiep B Industrial Park 26. Viet Huong 1 Industrial Park 27. Viet Huong 2 Industrial Park 28. Binh An Textile and Garment Industrial Park 29. Mai Trung Industrial Park 30. Binh Duong Industrial Park 31. Vinh Tan – Tam Binh Industrial Park 32. Thoi Hoa Industrial Park	1. Thanh Phu Industrial Park 2. Bien Hoa 1 Industrial Park 3. Bien Hoa 2 Industrial Park 4. Amata City Bien Hoa Industrial Park 5. Loteco Industrial Park 6. Song May Industrial Park 7. Ho Nai Industrial Park 8. Bau Xeo Industrial Park 9. Giang Dien Industrial Park 10. Tam Phuoc Industrial Park 11. Long Thanh Industrial Park 12. An Phuoc Industrial Park 13. Long Duc Industrial Park 14. Loc An – Binh Son Industrial Park 15. Nhon Trach 1 Industrial Park 16. Nhon Trach 2 Industrial Park 17. Boustead Industrial Park 18. Nhon Trach 3 (Phase 1) Industrial Park 19. Nhon Trach 3 (Phase 2) Industrial Park 20. Nhon Trach 5 Industrial Park 21. Nhon Trach 6 Industrial Park 22. Go Dau Industrial Park 23. Ong Keo Industrial Park 24. Nhon Trach Textile Industrial Park 25. Dinh Quan Industrial Park 26. Long Khanh Industrial Park 27. Loc Khang Industrial Park (Nhon Trach 2 – Loc Khanh Industrial Park) 28. Nhon Trach 2 – Nhon Phu Industrial Park 29. Tan Phu Industrial Park 30. Xuan Loc Industrial Park 31. Agtex Long Binh Industrial Park 32. Dau Giay Industrial Park 33. Suoi Tre Industrial Park 34. Amata City Long Thanh Industrial Park 35. Phuoc Binh Industrial Park 36. GT-Industrial Rental Factories Campus	1. Duc Hoa 1 Industrial Park 2. Duc Hoa 3 Industrial Park 3. Xuyen A Industrial Park 4. Tan Duc Industrial Park 5. Phu An Thanh Industrial Park 6. Vinh Loc 2 Industrial Park 7. Thuan Dao Industrial Park 8. Nhut Chanh Industrial Park 9. Hoa Binh Industrial Park 10. Phuc Long Industrial Park 11. Cau Tram Industrial Park 12. KIZUNA 1&2&3 Rental Service Factory 13. Tan Kim Industrial Park 14. Long Hau Industrial Park 15. Long Hau 3 Industrial Park 16. Cau Cang Phuoc Dong Industrial Park 17. Thanh Duc Industrial Park
TAY NINH	BINH PHUOC	BA RIA - VUNG TAU	CAN THO
1. Phuoc Dong – Boi Loi Industrial Park 2. Linh Trung 3 Industrial Park 3. Thanh Thanh Cong Industrial Park 4. Trang Bang Industrial Park 5. Tram Vang Industrial Park 6. Hiep Thanh Industrial Park 7. Cha La Industrial Park 8. Bourbon An Hoa – TransAsia Industrial Garden 9. Linh Trung 3 Export Processing Zone (Linh Trung EPZ) 10. Phuoc Dong Industrial Park	1. Minh Hung – Han Quoc Industrial Park 2. Minh Hung III Industrial Park 3. Bac Dong Phu Industrial Park 4. Nam Dong Phu Industrial Park 5. Dong Xoai I Industrial Park 6. Dong Xoai II Industrial Park 7. Dong Xoai III Industrial Park 8. Chon Thanh I Industrial Park 9. Chon Thanh II Industrial Park 10. Becamex Binh Phuoc Industrial Park 11. International Hoa Lu Border Gate	1. My Xuan B1 Industrial Park 2. My Xuan Tien Hung Industrial Park 3. My Xuan Dai Duong Industrial Park 4. My Xuan A1 Industrial Park 5. My Xuan A2 Industrial Park 6. Phu My 1 Industrial Park 7. Phu My 2 Industrial Park 8. Phu My 3 Specialized Industrial Park 9. Cai Mep Industrial Park 10. Chau Duc Industrial Park 11. Dong Xuyen Industrial Park 12. Long Son Industrial Park 13. Dat Do Industrial Park	1. Tra Noc I Industrial Park 2. Tra Noc II Industrial Park 3. Hung Phu I Industrial Park 4. Hung Phu II Industrial Park 5. Thot Not I Industrial Park 6. O Mon Industrial Park 7. Can Tho High-tech Park
VINH LONG	KIEN GIANG	DONG THAP	TIEN GIANG
1. Binh Minh Industrial Park 2. Hoa Phu Industrial Park 3. Dong Binh Industrial Park 4. An Dinh Industrial Park 5. Binh Tan Industrial Park	1. Thanh Loc Industrial Park 2. Xeo Ro Industrial Park 3. Tac Cau Industrial Park 4. Kien Luong I Industrial Park	1. Sa Dec Province Industrial Park 2. Tran Quoc Toan Industrial Park 3. Song Hau Industrial Park 4. Ba Sao Industrial Park 5. Tan Kieu Industrial Park	1. My Tho Industrial Park 2. Tan Huong Industrial Park 3. Long Giang Industrial Park 4. Soai Rap Petroleum Services Industrial Park
AN GIANG	BEN TRE	SOC TRANG	TRA VINH
1. Binh Hoa Industrial Park 2. Binh Long Industrial Park 3. Vam Cong Industrial Park	1. Giao Long Industrial Park 2. An Hiep Industrial Park 3. Phu Thuan Industrial Park	1. An Nghiep Industrial Park 2. Tran De Industrial Park 3. Dai Ngai Industrial Park	1. Cau Quan Industrial Park 2. Long Duc Industrial Park 3. Co Chien Industrial Park
BAC LIEU	HAU GIANG	CA MAU
1. Tra Kha Industrial Park 2. Lang Tram Industrial Park	1. Song Hau (Phase 1) Industrial Park 2. Tan Phu Thanh Industrial Park	1. Hoa Trung Industrial Park 2. Khanh An Industrial Park

If you need a consultation regarding to invest in Vietnam, don’t hesitate to contact HT.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

29/04/202218/07/2022

Forms of foreign investors contributing capital to Vietnamese companies

1. Forms and conditions for capital contribution, share purchase to the organization

1.1. Forms of capital contribution to Vietnamese enterprises by foreign investors

According to Article 25 Investment Law 2020, foreign investors may contribute capital to economic organizations in the following forms:

- Buy shares issued for the first time or additionally issued shares of a joint-stock company. Foreign investors become shareholders of joint-stock companies.
- Contribute capital to limited liability companies, partnerships. Foreign investors become members of limited liability companies, members of partnerships.
- Contribute capital to other economic organizations.

1.2. Forms of buying shares and contributed capital of Vietnamese companies

Foreign investors purchase shares and capital contributions of economic organizations in the following forms:

- Buy shares of a joint stock company from the company or shareholder;
- Purchase of capital contributions of members of a limited liability company to become a member of a limited liability company;
- Purchase of capital contributions of capital-contributing members in a partnership to become a capital-contributing member of a partnership;
- Purchase of capital contributions of members of economic organizations other than the above cases.

1.3 Conditions for capital contribution, share purchase by foreign investors

The capital contribution, share purchase portion of foreign investors in the forms specified above must satisfy the following conditions:

The rate of ownership of charter capital of foreign investors is restricted in listed companies, public companies, securities trading organizations and securities investment funds; Government-owned enterprises, equitization or ownership conversion in other forms. (Clause 1, Article 23 of the Investment Law 2020)

Investment form, scope of activities, Vietnamese partners participating in the implementation of investment activities and other conditions under the provisions of international treaties to which the Socialist Republic of Vietnam is a signatory.

2. Investment procedures in the form of capital contribution, share purchase

2.1 Foreign investors must carry out procedures for registration of capital contribution, purchase of shares to economic organizations in the following cases:

Foreign investors contribute capital, purchase shares or capital contributions to economic organizations operating in business lines with conditions applicable to foreign investors;

The capital contribution or purchase of shares or contributed capital results in a foreign investor or an economic organization in one of the following circumstances holding 51% or more of the charter capital of the economic organization:

i. Having a foreign investor holding 51% or more of the charter capital or having the majority of general partners being foreign individuals, for economic organizations being a partnership; or

ii. Having an economic organization at point i holding 51% or more of its charter capital; or

iii. Having foreign investors and economic organizations specified at Points i and ii holding 51% or more of charter capital.

The foreign investor that contributes capital, purchases shares or stakes of a business organization has a certificate of rights to use land on an island or in a border or coastal commune; in a coastal commune; in another area that affects national defense and security.

** Dossier for registration of capital contribution, share purchase:

A written registration for capital contribution, share purchase or capital contribution, including the following contents: information about the economic organization to which the foreign investor intends to contribute capital, purchase shares or capital contribution; rate of ownership of charter capital of foreign investors after capital contribution, purchase of shares or capital contribution to economic organizations;

Certified copies of the identity card, or passport for the investor being an individual; Certified copies of Business license or other equivalent document certifying legal status for investor being an organization.

** Procedures for registration of capital contribution, share purchase and capital contribution:

Step 1: The investor submits a dossier at the Department of Planning and Investment where the economic organization’s head office is located to register for capital contribution;

Step 2: After being approved for the registration of capital contribution, purchase of shares or contributed capital, the investor shall contribute capital, receive the transfer of shares and contributed capital, and carry out procedures in accordance with the Law on Enterprises.

2.2. Investors who are not subject to procedures for registration of capital contribution, purchase of shares or contributed capital:

Investors who are not in the case of carrying out the procedures for registration of capital contribution, purchase of shares mentioned above, and procedures for changing shareholders or members as prescribed by law when contributing capital or buying shares capital contribution of economic organizations. If there is a need to register the capital contribution, purchase of shares or contributed capital of an economic organization, the investor shall comply with regulations.

To save time learning about the law, filling out forms, waiting to submit the dossier, you can contact HTLaw for advice and support for Capital Contribution for Foreign Investor legal services.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

29/04/202225/07/2022

Set up a foreign-invested enterprise

Before establishing a foreign-owned enterprise, a foreign investor must have an investment project and carry out procedures for granting and adjusting the Investment Registration Certificate, except for the case of setting up a start-up small and medium-sized enterprise, creativity, and innovative start-up investment funds in accordance with the law on supporting small and medium enterprises.

Below is the procedure for establishing a foreign-owned enterprise, the investor shall carry out the procedure for issuing the Investment Registration Certificate according to the following steps:

1. Preparing documents for issuance of Investment Registration Certificate

An application for an Investment Registration Certificate includes:

1. A written request for the implementation of an investment project.

2. Documents proving legal status:

- For institutional investors: a copy of the Certificate of Establishment or other equivalent document certifying the legal status of the investor is an organization.
- For individual investors: Copy of identity card or passport.

3. Investment project proposal includes the following contents: investor implementing the project, investment objective, investment scale, investment capital. and capital mobilization plan, location, time, investment schedule, labor demand, a proposal for investment incentives, impact assessment, and socio-economic efficiency of the project.

4. Proof of investor’s financial capacity:

- For institutional investors: financial statements of the last 2 years of the investor. Or commit to the financial support of the parent company. Or pledge financial support from a financial institution. Or guarantee the financial capacity of the investor. Or documents explaining the investor’s financial capacity.
- For individual investors: confirm account balance, passbook;

5. Head office lease contract, Documents proving the lessor’s right to lease (Land use right certificate, Construction permit, Business registration certificate with real estate business function of the lessor or equivalent documents).

6. Proposed demand for land use; In case the project does not request the State to allocate or lease land or permit the change of land use purpose, a copy of the location lease agreement or other document certifying that the investor has the right to use the site for implementation of the project must be submitted. current investment project;

7. An explanation of the use of technology for investment projects, for projects using technologies on the list of technologies restricted from transfer in accordance with the law on technology transfer, include the following contents: name of technology, technology origin, technological process diagram; main technical parameters, use status of the main machinery, equipment, and technological lines;

2. Submit application for Investment Registration Certificate

Procedures for granting an Investment Registration Certificate for investment projects that are not subject to a decision on investment policies are as follows:

Online declaration of information about investment projects on the National Foreign Investment Information System

- Before carrying out the procedures for issuance of the Investment Registration Certificate, the investor shall declare online information about the investment project on the National Foreign Investment Information System. Within 15 days from the date of online declaration, the investor shall submit the application for the Investment Registration Certificate to the Investment Registration Authority.
- After the Investment Registration Authority receives the application, the investor is granted an account to access the National Information System on Foreign Investment to monitor the processing of the application.
- The investment registration agency uses the National Foreign Investment Information System to receive, process, and return investment registration results, update the status of application processing, and issue code numbers for the investment project.

Submit an application directly for an Investment Registration Certificate

An investor shall submit an application for an Investment Registration Certificate at the investment registration agency according to its competence as follows:

Department of Planning and Investment of the province where the company’s head office is located:

- Investment projects outside industrial parks, export processing zones, high-tech zones, economic zones;
- Investment projects on infrastructure development of industrial parks, export processing zones, high-tech zones, and investment projects in industrial parks, export processing zones, and high-tech zones in localities where a Management Board has not yet been established. industrial parks, export processing zones, and high-tech zones.
- Investment projects implemented in many provinces and centrally-run cities;
- Investment projects are implemented simultaneously inside and outside industrial parks, export processing zones, high-tech zones, and economic zones.

The management board of industrial parks, export processing zones, high-tech zones, and economic zones of the province where the company is headquartered

- Investment projects on infrastructure development of industrial parks, export processing zones, and high-tech zones;
- Investment projects are implemented in industrial parks, export processing zones, high-tech zones, and economic zones.

3. Issuance of Investment Registration Certificate

Within 15 days from the day on which the complete application is received, the investment registration agency shall issue the Investment Registration Certificate. In case of refusal, the investor must be notified in writing and clearly state the reasons therefor.

4. Prepare documents and submit the application for the Enterprise Registration Certification

After a foreign-invested company is granted an Investment Registration Certificate, the investor shall carry out the procedures for granting an enterprise registration certificate similar to the procedure for establishing a Vietnamese-owned company.

Dossier of application for an enterprise registration certificate

- Business registration application form.
- Company rules.
- Copies of the following papers: Citizen’s identity card, Passport, or other lawful personal identification of members being individuals; owner (for one-member limited liability companies), founding shareholders (for joint stock companies);
- Establishment decision, enterprise registration certificate or other equivalent documents of owners, company members, founding shareholders being organizations.
- Decision on appointment of a manager of the contributed capital portion of the owner, capital contributor, shareholder being an organization and Identity Card/Citizen Identity Card, Passport or other lawful personal identification of the manager of the contributed capital portion.
- List of members (for limited liability companies with two or more members; List of founding shareholders and shareholders being foreign investors (list of authorized representatives if there are institutional shareholders).
- An investment registration certificate for investors has been granted.

Competence to issue business registration certificates:

Department of Planning and Investment of the province where the company’s head office is located

5. Next steps

- Disclosure of business registration information
- Engraving the company’s seal
- Open a foreign direct investment capital account
- Signboard at headquarters.
- Register digital signature for electronic tax payment and tax report online
- Buy an electronic digital signature to make an electronic tax payment
- Proposal to issue e-invoices.
- Make reports on project implementation according to the provisions of the Investment Registration Certificate.
- Declare and pay tax according to regulations.

In addition, foreign investors can invest in the form of capital contribution or purchase of shares of Vietnamese companies. See details here.

For institutional investors, you can set up a representative office to learn the market before setting up a company. Establishing a representative office will be more cost-effective and faster in terms of time. See details here.

To save time learning the procedures, filling in the form, notarizing, and waiting for submitting the application, you can contact HTLaw for Registration of a foreign-invested company services.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

29/04/202202/08/2022

Regular Legal Consultation Package

1. What is Regular Legal Consultation package?

Regular legal consultation package for small and medium-sized businesses without a legal department. When using this service, businesses can answer and resolve legal issues quickly and economically.

HT can flexibly customize the service package to suit each customer with different needs, ensuring to meet the needs of the business at the most reasonable cost.

2. Services in Regular Legal Consultation package

- Answer legal questions related to business, investment, labor, immigration, and other fields.
- Drafting and reviewing legal documents (contracts, agreements, etc.)
- Provide new legal updates for business operations
- Dispute resolution consulting, litigation participation
- Legal advice on projects, mergers and acquisitions, purchase and sale, and transfer of contributed capital and shares
- Consulting, registration of intellectual property

3. Why using Regular Legal Consultation package is necessary?

In the course of business operations, it is difficult for enterprises to avoid legal risks that may occur in the business process, from internal management of the enterprise to business development, etc. all of which have potential risks of arising conflicts, disputes, and damages arising from unforeseeable legal risks, among them are the following risks:

- Enterprises do not have clear working processes and regulations, leading to disputes between capital contributors
- Enterprises are sued for dismissing employees who do not comply with the prescribed legal order and procedures (about labor contracts, social insurance, employee welfare regimes, …)
- Enterprises lose their trade and are counterfeited or counterfeit products that are not protected by law.
- Enterprises may encounter unfavorable terms scattered in commercial contracts or enterprises sign contracts of great value but are not valid due to provisions contrary to the provisions of law.
- Enterprises are fined for not complying with regulations on business registration.

Regular legal consulting services will prevent the above cases from happening and support businesses to quickly resolve when the above risks occu

To save time learning about the law and limit legal risks in business operations, you can contact HT to design a customized Regular Legal Consultation Package.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

03/08/202119/07/2022

INVESTMENT INCENTIVE POLICIES

Vietnam is gradually becoming a potential market for foreign investors. Therefore, from January 1, 2021, the Vietnamese government has issued more investment incentive policies to attract foreign investment. HT would like to summarize investment incentives and support policies effective from January 1, 2021 below:

1.
Forms of investment
incentives:

Corporate income tax incentives, including application of a lower rate of corporate income tax for a certain period of time or throughout the investment project execution; exemption from and reduction of tax and other incentives prescribed by the Law on Corporate Income Tax.

Exemption from import tax on goods imported to form fixed assets; raw materials, supplies and components for manufacturing purposes in accordance with regulations of law on import and export tax;

Exemption from and reduction of land levy and land rents;

Accelerated depreciation, increasing the deductible expenses upon calculation of taxable income.

2. Entities eligible for investment incentives:

Investment projects in business lines eligible for investment incentives or business lines eligible for special investment incentives specified in Appendix II of Notice 31/2021/ND-CP.

Investment projects located in disadvantaged or extremely disadvantaged areas specified in the Appendix III of Notice 31/2021/ND-CP.

Any investment project whose capital is at least VND 6,000 billion eligible for investment incentives as prescribed in Point c Clause 2 Article 15 of the Law on Investment if the following conditions are met:

a) At least VND 6,000 billion is disbursed within 03 years from the issuance date of the investment registration certificate or the decision on approval for both investment guidelines and investor (for the project not required to obtain the investment registration certificate) or the decision on investor approval (for the project not required to obtain the investment registration certificate);

b) The total revenue is at least VND 10,000 billion per year within 03 years from the year in which the revenue is earned or the project has an annual average number of at least 3,000 employees in accordance with regulations of law on labor 03 years within 03 years from the year in which the revenue is earned;

The investment projects eligible for investment incentives specified in Point d Clause 2 Article 15 of the Law on Investment include:

a) Projects on investment in construction of social housing in accordance with regulations of law on housing;

b) Investment projects located in rural areas and employing at least 500 employees per year in accordance with regulations of law on labor (excluding employees who work on a part-time basis and employees who sign employment contracts with a fixed term of under 12 months);

c) Investment projects employing persons with
disabilities accounting for at least 30% of the annual average number of
employees in accordance with regulations of law on persons with disabilities
and on labor.

Hi-tech enterprises, science and technology enterprises and science and technology organizations; projects involving transfer of technologies on the List of technologies the transfer of which is encouraged; science and technology enterprise incubators; enterprises manufacturing and providing technologies, equipment, products and services with a view to satisfaction of environment protection requirements which are eligible for investment incentives as prescribed in Point dd Clause 2 Article 15 of the Law on Investment are enterprises, organizations, facilities and investment projects that satisfy the conditions prescribed by the law on science and technology; high technology; technology transfer; environmental protection.

Objects eligible for investment incentives specified in Point e Clause 2 Article 15 of the Law on Investment include:

a) The National Innovation Center established under
the Prime Minister’s decision;

b) Other innovation centers established by agencies,
organizations and individuals so as to assist in executing start-up projects,
establishing startups and promoting innovation, research and development in the
centers which satisfy the conditions set forth in Clause 7 of this Article;

c) Start-up projects specified in Clause 8 of this
Article;

d) Projects on establishment of research and
development centers.

An innovation center specified in Point b Clause 6 of this Article will be eligible for investment incentives if it:

a) exercises the functions of supporting, developing
and connecting startups with the startup ecosystem;

b) has several technical infrastructure items to
serve the support, development and connection of the startup ecosystem,
including laboratories, trial production and technology commercialization
laboratories assisting enterprises in development of sample products; has
infrastructure serving technical equipment installation to ensure one or more
activities for enterprises to design, test, measure, analyze, inspect and test
products, goods and materials; has information technology infrastructure
assisting enterprises and space for organizing events, exhibiting and
demonstrating start-up technologies and products;

c) has managerial professionals to provide assistance,
development and connection services for enterprises operating in the center;
has a network of experts and providers of assistance, development and
connection services.

The start-up project specified in Point c Clause 6 of this Article is one of the following projects:

a) Projects on manufacturing of products created
from inventions, utility solutions, industrial designs, semiconductor
integrated circuits layout-designs, computer software, applications on mobile
phones, cloud computing; production of new livestock breed or line, new plant
varieties, new aquatic breeds, new forest tree cultivars; technological
advances which have been granted protection certificates in accordance with
regulations of law on intellectual property or copyrights or international
registration certificates in accordance with regulations of international
treaties to which Vietnam is a signatory or recognized by competent
authorities;

b) Projects on manufacturing of products obtained
from projects on trial production, sample products and technology completion;
manufacturing of products given awards at start-up competitions, national
start-up competitions, scientific and technological awards in accordance with
regulations of law on scientific and technological awards;

c) Projects of enterprises operating in innovation
centers and research and development centers;

d) Projects on manufacturing of culture industry
products formed from copyrights or copyright-related rights that have been
granted protection certificates in accordance with regulations of law on
intellectual property or international registration certificates in accordance
with regulations of international treaties to which Vietnam is a signatory.

Small and medium-sized enterprises’ product distribution chain eligible for investment incentives as specified in Point g Clause 2 Article 15 of the Law on Investment means a network of intermediaries that distribute products of such small and medium-sized enterprises (SMEs) to consumers and meet the following conditions:

a) At least 80% of enterprises joining the chain are
small and medium-sized enterprises;

b) There are at least 10 places for distribution of
goods to consumers;

c) At least 50% of revenue of the chain are generated
by SEMS joining the chain.

SME incubators; technical establishments supporting SMEs; co-working spaces supporting start-up SMEs eligible for investment incentives as specified in Point g Clause 2 Article 15 of the Law on Investment are those established in accordance with regulations of law on provision of assistance for SMEs.

3.
Procedures for applying investment incentives

Investors carry out the procedures for applying incentives according to the provisions of law in Article 17 of the Investment Law 2020, Articles 19 and 24 of Decree 31/2021/ND-CP.

Please feel free to contact us by email: huonghue.ht@gmail.com or phone number +84 935 439 454 if you need any further clarification. We look forward to long-term co-operation with you.

08/04/202119/07/2022

FORMS OF INVESTMENT BY THE VIETNAM REGULATIONS

To have a suscessful investment project, Investors are first required to pick suitable investing form together with meeting the most fundamental conditions. We at HT Legal hereby provide those who are wishing to invest in Vietnam some basic information on the forms of investment and the conditions required for your reference.

According to the current law on investment of Vietnam, the forms of investment in Vietnam including:

Investment in establishment of a business organization

Investors can choose establishing an economic organization to carry out their investment activities in Vietnam, in which the most popular selected have been limited liability company, joint stock company and partnerships.

Investment by contributing capital, purchasing shares or capital of business organizations

In addition to the establishment of an economic organization for new investment project as said above, the investors shall be entitled to contribute capital, purchase shares or capital to the existing economic organizations operating in Vietnam. Including:

Capital contribution	a) Buy shares of joint-stock companies through IPOs or additional issuance; b) Contribute capitals to limited liability companies and partnerships; c) Contribute capital to other business organizations not mentioned in above
Shares or capital purchase	a) Buy shares of joint-stock companies from the companies or their shareholders; b) Buy capital contributions to limited liability companies by their members and become members of limited liability companies; c) Buy capital contributions to partnerships by partners and become partners; d) Buy capital contributions to business organizations other than those mentioned above.

Investment under PPP contracts

Investors and project management companies shall sign PPP contracts (Public-Private Partnership contract) with competent authorities to execute an investment project to build new infrastructural works, to improve, upgrade, expand, manage, and operate infrastructural works, or to provide public services.

Investment under business cooperation contracts (BCC)

Business cooperation contract (BCC) means a contract between investors for business cooperation and distribution of profits, products without establishment of a new business organization.

In particular, the most common forms are 1) Investment in establishment of a business organization and 2) Investment by contributing capital, purchasing shares or capital of business organizations, which are considered by majority of small and medium investors due to simpler legal procedures for medim project. Therefore, the information privided below will focus on these two popular forms.

On choosing form of investment, investors must meet certain conditions and comply with the procedures prescribed by law for each form. In general, however, investors should first notice and meet the following basic conditions:

Conditions on investment capital:

For the form of establishment of an economic organization, the investor should demonstrate their capital contribution ability in implementing and maintaining the project through financial credentials, usually bank statements (for individuals) or financial statements/reports of recent years (for organizations/companies).

For the second form, the investors are exempt from providing the above financial proofs, as the financial capacity of the investors should be checked and assessed by the enterprise selling capital/shares or receiving capital contribution.

Conditions on activities:

In Vietnam, some investment and business activities have specific conditions for foreign individuals and organizations and investors should thoroughly understand the regulations prior to their registration of investment in Vietnam,. These may be limitation on the scope of investing activities, professional capacity or the shares of foreign capital in an entity. Often, those conditions are set on the basis of agreements and commitments between Vietnam and the countries of investors, commonly WTO Commitments on Trade in Goods, Services, FTAs, AFAS,…

Therefore the investors should consult with a lawyer or consultant to find out if their investment activities are subject to restrictions by law.

Conditions on the place performing project

In the case of establishment of a new economic organization, a lease contract for office, workshops, warehouses, etc., must be entered into before and included when registering the investment project. However, investors may apply for adjustment if there is a change in location later.

Conditions on the capacity of speciality, management, operation of investors

Among the conditions, although this is an optional condition, it plays an important role in explaining the capacity of the investors in the registration procedure. Investors should provide proof of ability such as professional qualifications, managerial experience, management, work experience, etc., to prove their superiority and to facilitate for the process

Please feel free to contact us by email: huonghue.ht@gmail.com or phone number +84 935 439 454 if you need any further clarification. We look forward to long-term co-operation with you.

15/01/202118/07/2022

INVESTORS TRANSFER PROFITS ABOARD

After generating profits in Vietnam, many foreign-invested enterprises have to remit their profits abroad for investment, expenses payment,… Therefore, Vietnamese law has many provisions on the above issues as follows:

1. Annual profit:

Annual profit remitted abroad is the profit shared or earned by a foreign investor in a fiscal year from direct investment activities based on audited financial statements, tax finalization declarations, and corporate incomes.

plus (+)

Other profits such as the unearned profit from the previous years;

minus (-)

The expenditure which foreign investors have used or committed to re-invest in Vietnam;
The profits used by foreign investors for their operations, business production;
The personal spendings of foreign investors in Vietnam.

Time of transfer:

At the end of the fiscal year;
After the foreign enterprise has fulfilled its financial obligations toward the Vietnamese State by the law;
The audited financial statements and the fiscal year corporate income tax finalization declarations submit to the direct tax administration.

2. Profits upon the termination of operations in Vietnam:

Definition: Profits transferred abroad at the end of investment activities in Vietnam are the total profits earned by foreign investors during their direct investment in Vietnam.

minus (-)

Profits used for reinvestment;
Profits remitted abroad during the operations of foreign investors in Vietnam;
The other spendings of investors use in Vietnam.

Time of transfer:

Upon the completion of direct investment activities in Vietnam after the enterprise in which the foreign investor participates in investment has fulfilled its financial obligations toward the Vietnamese State by the law;
The audited financial statements and corporate income tax finalization declarations submit to the direct tax administration and at the same time meet fulfilling obligations under the Law on Tax Administration.

Note:

In the year which still has accumulated loss in the financial statements of the enterprises after carrying forward losses by the tax law, foreign investors are not allowed to transfer abroad the profits.

3. Mode of profit transfer

a/ Profits remitted abroad in cash will be through direct investment capital accounts

Note:

If the enterprise with foreign direct investment capital is closed their direct investment accounts, Foreign investors will not be allowed to use the direct investment capital account.

Instead, The investors can use the foreign currency payment account, Vietnamese dong current accounts opened at an authorized bank to transfer profits legally.

The cases of closing direct investment accounts in enterprises with foreign direct investment capital:

Due to the dissolution or termination of the operation of the enterprise.

Or the transfer of investment capital changes the original legal entity of the FDI enterprise.

b/ Profits in kinds: Goods are not banned by the export-import law.

The conversion of the value of in-kind shall comply with the law on merchandises import and export and relevant provisions.

Please feel free to contact us by email: huonghue.ht@gmail.com or phone number +84 935 439 454 if you need any further clarification. We look forward to long-term co-operation with you.

24/12/202018/07/2022

FRANCHISING IN VIETNAM REGULATIONS

Currently, franchising helps brands get closer to consumers, which is a potential option considered by many investors. Based on the provisions of Vietnamese law, HTLaw would like to summarize the most basic and important information about Franchising in Vietnam.

I. Conditions for the franchisor

A businessman shall be permitted to grant commercial rights when fully satisfying the following conditions:

1. The business system intended to be used for franchising has been in operation for at least 1 year. In case a Vietnamese trader is a primary franchisee from a foreign franchisor, that Vietnamese trader must do business under the franchising method for at least 1 year in Vietnam before re-granting a franchise.

2. Such a trader has registered franchising with a competent agency.

3. Business goods and services subject to commercial rights do not violate regulations.

II. Conditions for the franchisee

A trader shall be permitted to receive commercial rights when having the registration of business lines subject to commercial rights.

III. Goods and services permitted for franchising business

1. Goods and services permitted for franchising businesses are those not on the list of goods and services banned from the business.

2. Enterprises shall be permitted to deal in goods and/or services on the list of goods and services restricted from business or those on the list of goods and services subject to conditional business only after being granted business licenses or papers of equivalent value by the branch-managing agencies or fully satisfying business conditions.

IV. Contents of the franchising contract

Where the parties choose to apply Vietnamese law, a franchising contract may have the following principal contents:

1. Content of franchised commercial right.

2. Rights and obligations of the franchisor.

3. Rights and obligations of the franchisee.

4. Price, periodical franchise fee, and mode of payment.

5. Valid term of the contract.

6. Renewal and termination of the contract, and settlement of disputes.

V. Language of the franchising contract

The franchise contract must be made in Vietnamese. In case of franchising from Vietnam to abroad, the language of the franchise contract shall be agreed upon by the parties.

VI. Valid term of the franchising contract

The valid term of a franchising contract shall be agreed upon by the involved parties.

VII. Registration of franchising

1. Before conducting franchising activities, Vietnamese traders or foreign traders that intend to franchise must register franchising with competent agencies.

2. The agency competent to register commercial franchising activities shall register the trader’s commercial franchising activities in the commercial franchising register and notify the trader in writing of the registration.

VIII. Decentralization of responsibility to register franchising

1. The Ministry of Trade shall register the following franchising activities:

a) Franchising from overseas into Vietnam, including franchising from export processing zones, non-tariff areas, or separate customs areas specified by Vietnamese law into the Vietnamese territory;

b) Franchising from Vietnam to overseas, including franchising from the Vietnamese territory into export processing zones, non-tariff areas, or separate customs areas specified by Vietnamese law.

2. Trade Services and Trade-Tourism Services of provinces or centrally-run cities where traders that intend to franchise make business registration shall register franchising at home, except for franchising across boundaries of export processing zones, non-tariff areas, or separate customs areas specified by Vietnamese law.

IX. Dossiers of application for registration of franchising

A dossier of applications for registration of franchising comprises:

1. An application for registration of franchising, made according to the form guided by the Ministry of Trade.

2. A written introduction to franchising, made according to the form set by the Ministry of Trade.

3. Written certifications of:

a) The legal status of the intended franchisor;

b) Industrial property rights protection titles in Vietnam or a foreign country in case of licensing industrial property subject matters for which protection titles have been granted.

4. Where papers specified in Clauses 2 and 3 of this Article are written in foreign languages, they must be translated into Vietnamese and notarized by domestic notaries public or Vietnam’s foreign-based diplomatic missions and consular legalized according to the provisions of Vietnamese law.

X. Procedures for registering to franchise

1. An intended franchisor shall register franchising according to the following procedures:

a) Sending a dossier of application for registration of franchising to the competent state agency defined in Article 18 of this Decree;

b) Within 5 working days after receiving a complete and valid dossier, the competent state agency shall register franchising in the franchising register and notify in writing the traders of such registration.

c) Where the dossier is incomplete or invalid, the competent state agency shall, within 2 working days after receiving such dossier, notify such in writing to the intended franchisor for supplementation and completion of its dossier;

d) The time limits specified in this Clause shall not include the time for the intended franchisor to amend and supplement its dossier of application for registration of franchising;

e) Past the time limits specified in this Clause, if the competent state agency refuses to effect the registration, it must notify such in writing to the intended franchisor, clearly stating the reasons for refusal.

2. Procedures for registering contracts on licensing of industrial property subject matters shall comply with the provisions of the law on industrial property.

To save time learning about the law, filling out forms, and submitting documents, you can contact HTLaw for consultation and legal services related to Franchise.

Contact us

- Email: hue.truong@htlaw.vn
- Phone number: +84 935 439 454.

21/12/202018/07/2022

REGULATING ADMINISTRATIVE PENALTIES FOR TAX (Decree 125/2020)

From December 5, 2020, Decree 125/2020 providing for tax penalties and invoices takes effect. To help readers have an overview of the regulations on penalties for violations of tax obligations, we would like to summarize the following notable points:

1. Penalties for violations against regulations on tax registration time limits; notification of temporary business suspension; notification of premature business continuation

CASE 1:

Cautions

Making tax registration; notifying the temporary business suspension; notifying the premature business continuation from 1 to 10 days after expiration of the prescribed time limits under mitigating circumstances.

CASE 2:

Fines ranging from VND 1,000,000 to VND 2,000,000

a) Making tax registration; notifying the premature business continuation from 1 to 30 days after expiration of the prescribed time limits, except the cases prescribed in CASE 1;

b) Notifying the temporary business suspension after expiration of the time limits, except the cases prescribed in CASE 1;

c) Failing to notify the temporary business suspension.

CASE 3:

Fines ranging from VND 3,000,000 to VND 6,000,000

Making tax registration; notifying the premature business continuation from 31 to 90 days after expiration of the prescribed time limits.

CASE 4:

Fines ranging from VND 6,000,000 to VND 10,000,000

a) Making tax registration; notifying the premature business continuation from at least 91 days after expiration of the prescribed time limits;

b) Failing to notify the premature business continuation without any more taxes incurred.

2. Penalties for violations against regulations on time limits for notification of changes in tax registration information

CASE 1:

Cautions

a) Notifying changes in tax registration information from 01 to 30 days after expiration of the prescribed time limits without entailing any change in tax registration certificates or tax identification number notifications under mitigating circumstances;

b) Notifying changes in tax registration information from 01 to 10 days after expiration of the prescribed time limits if such changes entail any change in tax registration certificates or tax identification number notifications under mitigating circumstances.

CASE 2:

Fines ranging from VND 500,000 to VND 1,000,000

The act of notifying changes in tax registration information from 01 to 30 days after expiration of the prescribed time limits without entailing any change in tax registration certificates or tax identification number notifications, except the cases specified in point an of Case 1a.

CASE 3:

Fines ranging from VND 1,000,000 to VND 3,000,000

a) Notifying changes in tax registration information from 31 to 90 days after expiration of the prescribed time limits without entailing any change in tax registration certificates or tax identification number notifications;

b) Notifying changes in tax registration information from 01 to 30 days after expiration of the prescribed time limits if such changes entail any change in tax registration certificates or tax identification number notifications, except as specified in point of case 1b.

CASE 4:

Fines ranging from VND 3,000,000 to VND 5,000,000

a) Notifying changes in tax registration information at least 91 days after expiration of the prescribed time limits without entailing any change in tax registration certificates or tax identification number notifications;

b) Notifying changes in tax registration information from 31 to 90 days after expiration of the prescribed time limits if these changes entail any change in tax registration certificates or tax identification number notifications.

CASE 5:

Fines ranging from VND 5,000,000 to VND 7,000,000

a) Notifying changes in tax registration information at least 91 days after expiration of the prescribed time limits if these changes entail any change in tax registration certificates or tax identification number notifications;

b) Failing to notify changes of information contained in tax registration applications.

Regulations below shall not be applied to the following cases:

a) Non-business persons who have been granted personal income tax identification codes delay in registering changes in their ID information after receipt of 12-digit ID cards;

b) Income payers delay in registering changes from ID cards to 12-digit ID cards of PIT payers that are persons granting authorization to complete PIT finalization procedures;

c) Notifying changes in information about taxpayer’s address contained in tax registration applications after expiration of the prescribed time limits due to any change in administrative jurisdictions under the Resolutions of the National Assembly’s Standing Committee or National Assembly.

3. Penalties for acts of making a false or incomplete declaration of information contained in tax dossiers that do not lead to any deficiency in taxes payable or any increase in amounts of tax exemption, reduction, or refund

CASE 1:

Fines ranging from VND 500,000 to VND 1,500,000

Making false or incomplete declaration of information required in data fields of tax dossiers which are not related to the determination of tax obligations, except the acts prescribed in CASE 2 below.

CASE 2:

Fines ranging from VND 1,500,000 to VND 2,500,000

Acts of making a false or incomplete declaration of information required in data fields of tax declaration forms and enclosed annexes which are not related to the determination of tax obligations.

CASE 3:

Fines ranging from VND 5,000,000 to VND 8,000,000

a) Falsely or incompletely filling out data fields related to the determination of tax obligations in tax dossiers;

b) Performing the acts prescribed in clause 3 of Article 16; clause 7 of Article 17 herein Decree 125/2020.

4. Penalties for violations against regulations on time limits for submission of tax returns

CASE 1:

Cautions

Violations arising from filing tax returns from 01 to 05 days after expiration of the prescribed time limits under mitigating circumstances.

CASE 2:

Fines ranging from VND 2,000,000 to VND 5,000,000

The act of submitting tax returns from 01 to 30 days after expiration of the prescribed time limits, except the cases specified in CASE 1.

CASE 3:

Fines ranging from VND 5,000,000 to VND 8,000,000

The act of submitting tax returns from 31 to 60 days after expiration of the prescribed time limits.

CASE 4:

Fines ranging from VND 8,000,000 to VND 15,000,000

a) Filing tax returns from 61 to 90 days after expiration of the prescribed time limits;

b) Filing tax returns at least 91 days after expiration of the prescribed time limits if none of the additional taxes is incurred;

c) Failing to submit tax returns if none of the additional taxes is incurred;

d) Failing to submit annexes under regulations regarding tax administration by enterprises having related-party transactions, enclosing CIT finalization dossiers.

CASE 5:

Fines ranging from VND 15,000,000 to VND 25,000,000

The act of filing tax returns more than 90 days after the prescribed deadline if such act results in additional taxes to be paid, and the taxpayer has fully paid taxes, deferred amounts into the state budget before the time of the tax authority’s announcement of the decision on tax inspection and examination, or before the time of the tax authority’s issuance of the report on the deferred submission of tax returns.

5. Penalties for violations against regulations on the provision of information about the determination of tax obligations

CASE 1:

Fines ranging from VND 2,000,000 to VND 3,000,000

a) Providing statutory information, documents, and records related to tax registration according to notifications issued by tax authorities at least 05 working days after expiration of the prescribed time limits;

b) Providing statutory accounting information, documents, and records related to the determination of tax obligations according to notifications issued by tax authorities at least 05 working days after expiration of the prescribed time limits.

CASE 2:

Fines ranging from VND 3,000,000 to VND 5,000,000

a) Failing to provide, or incompletely or inaccurately providing, information, documents, records, invoices or accounting books related to the determination of tax obligations; incompletely or inaccurately providing account numbers, balances of deposit accounts, checking accounts for competent authorities upon their request;

b) Failing to provide, or incompletely or wrongly providing, information or data related to tax obligations of which registration must be made under regulations on condition that this act does not result in any reduction in tax obligations to the state budget;

c) Failing to provide, or incompletely or inaccurately providing, information, documents related to deposit accounts, checking accounts opened at credit institutions, state treasuries, or debts of related third parties, for competent tax authorities upon their request.

6. Administrative penalties for violations against regulations on compliance with decisions on tax inspection and examination, enforcement of tax-related administrative decisions

CASE 1:

Fines ranging from VND 2,000,000 to VND 5,000,000

a) Rejecting decisions on tax inspection and examination, decisions on enforcement of tax-related administrative decisions which are sent or delivered by tax authorities under laws;

b) Failing to execute tax inspection and examination decisions at least 03 days after the deadline for compulsory execution of decisions of competent authorities after the prescribed time limit;

c) Providing documents, records, invoices, accounting vouchers, and books related to tax obligations 6 working hours after the prescribed time limit, upon receipt of requests from competent authorities during tax examination or inspection visits at taxpayers’ offices or premises;

d) Incompletely or inaccurately providing information, documents, accounting records, and books related to the determination of tax obligations upon competent authorities’ request during tax examination or inspection visits at taxpayers’ offices or premises;

e) Failing to sign a record of the tax examination or inspection within 05 working days from the date of issuance or public announcement of the record.

CASE 2:

Fines ranging from VND 5,000,000 to VND 10,000,000

a) Failing to provide data, documents, accounting records and books related to the determination of tax obligations upon competent authorities’ request during tax examination or inspection visits at taxpayers’ offices or premises;

b) Failing to carry out, or unduly carrying out, decisions on security sealing of documents, records, reconciliation of funds, stocktaking of goods, input materials, supplies, machinery, equipment, workshops, and facilities;

c) Deliberately removing or changing security seal signs lawfully created by competent agencies.

Please feel free to contact us by email: huonghue.ht@gmail.com or phone number +84 935 439 454 if you need any further clarification. We look forward to a long-term co-operation with you.

I. Conditions for capital contribution by land use rights

II. Conditions for receiving capital contribution by land use rights

III. Dossier of capital contribution by land use right

IV. Procedures for capital contribution by land use rights

I. Definition of labor dispatch sector

II. Does the foreign investor have the ability to conduct labor dispatch activities in Vietnam?

III. Conditions of conducting labor dispatch of foreign businesses

IV. License for conducting labor dispatch

V. Procedures of licensing

I. Legal basis

II. Differences between dissolution and bankruptcy

Note:

I. Legal grounds

II. Procedures for foreigners to buy houses to live in Vietnam

1. Legal basics

2. Compare Representative Office with Branch of enterprise in Vietnam

1. Legal basics

2. The issues of granting Representative Office/ Branch Establishment licenses

I. Legal basics

II. What is a representative office of foreign investor in Vietnam?

III. Permitted activities of representative office

IV. Restricted activities of representative office

I. Limited liability company

II. Partnerships

III. Joint Stock company

I. Industrial park in the North of Vietnam

II. Industrial park in the Center of Vietnam

III. Industrial park in the South of Vietnam

1. Forms and conditions for capital contribution, share purchase to the organization

1.1. Forms of capital contribution to Vietnamese enterprises by foreign investors

1.2. Forms of buying shares and contributed capital of Vietnamese companies

1.3 Conditions for capital contribution, share purchase by foreign investors

2. Investment procedures in the form of capital contribution, share purchase

2.1 Foreign investors must carry out procedures for registration of capital contribution, purchase of shares to economic organizations in the following cases:

2.2. Investors who are not subject to procedures for registration of capital contribution, purchase of shares or contributed capital:

1. Preparing documents for issuance of Investment Registration Certificate

2. Submit application for Investment Registration Certificate

3. Issuance of Investment Registration Certificate

4. Prepare documents and submit the application for the Enterprise Registration Certification

5. Next steps

1. What is Regular Legal Consultation package?

2. Services in Regular Legal Consultation package

3. Why using Regular Legal Consultation package is necessary?

I. Conditions for the franchisor

II. Conditions for the franchisee

III. Goods and services permitted for franchising business

IV. Contents of the franchising contract

V. Language of the franchising contract

VI. Valid term of the franchising contract

VII. Registration of franchising

VIII. Decentralization of responsibility to register franchising

IX. Dossiers of application for registration of franchising

X. Procedures for registering to franchise

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