If you’re having a business plan and you wish to set up company in Vietnam to conduct that business, great! There are many things you should planning, and legal issue is an important part. Following these legal instructions maybe help you clear about how to set up a new company in Vietnam
Step 1. Determine your business lines
Depending on a idea of your business, it could be very different plan for each investor. In order to register company in Vietnam, you must figure out which specific business industries you’re going to do. Otherwise, you will fail in set up company here.
Vietnam does not completely open market in all businesses for foreign investors. Instead, we classify 3 types of business lines applying for foreign investors:
– Non-conditional business lines, such as: IT Service, Food and Beverage Service, Management Consulting Service and Construction Service. Foreign investors can invest to these business lines without any difficulty. In general, the licensing times are quickly and paper works is simple.
– Conditional business lines, such as: Retail Distribution, Real Estate and Education. In order to invest these businesses, foreign investors shall fulfill specific legal conditions for each industry. Since your investment project needs to have approvals of relevant Ministries. It may takes you long time to get full licenses and sub licenses.
– Restricted business lines, such as: weapon and purchase or sale of humans. Surely, you can not invest in these businesses in any case.
Identifying the conditions to do a specify business is the most complex parts during the preparation step to invest in Vietnam. To find out more information, you may want to read this article: CONDITIONAL BUSINESS FOR FOREIN INVESTORS IN VIETNAM.
Step 2. Find an address/location for your company
When registering company with the Government of Vietnam, you shall provide a specific address of your company. In particular, a lease agreement and legal documents of location will be required. So what you should do:
– Find an address for your company, where you will actually conduct your business there;
– Ask landlord for documents of the address, give them to a lawyer to check whether this location is legal to open company there;
– Sign a lease agreement and take notarized copies of location’s documents.
If you want to know more legal conditions about company’s address, please read this article: LOCATION TO OPEN COMPANY.
Step 3. Choose a name for your business
It’s time to creative. Let’s pick a cool and unique name for your business. Before deciding to use a final name, make sure that the name does not duplicate or confuse other company’s names in Vietnam. You can check the existing name on the Vietnam National Business Registration Portal, Vietnam Industrial Property Digital Library and domains name.
Read This Article to understand how to name your company under Vietnamese Laws: CHOOSE A COMPANY NAME
Step 4. Choose a right business structure for your company
This is the most common question of investors when starting a company in Vietnam. Different countries have different rules on company types. Previously, you need to establish who is going to be involved in your company, who all directors and shareholders be. Remember, directors RUN the company and shareholders OWN the company. Of course, director can be a shareholder. In Vietnam, basically, we have 4 company types applying for foreign investors, which are:
– SINGLE MEMBER LLC: the company type has only one owner;
– MULTIPLE – MEMBER LLC: the company type has from 2 to 50 owners (members);
– JOINT – STOCK COMPANY: the company type has minimum 3 owners (shareholders) and unlimited maximum owners. The JSC can be a public company by join Vietnam Stock Market (optional)
– PARTNERSHIP COMPANY: the company types has minimum 2 owners. To date, PCs have not been a common vehicle for foreign investment in Vietnam
There is no different with tax issues if just base on company structure.
Read this Article: TYPES OF COMPANY IN VIETNAM for more information.
LEGAL STEPS TO SET UP A COMPANY IN VIETNAM
Depending on your business lines, there are very different required licenses, or sub-licenses. Basically, there are 2 mandatory licenses applying for all new companies:
1. Investment Registration Certificate (“IRC”)
This is the most difficult step during company registration step. You must have approval of Department of Planning and Investment (“DPI”) and maybe other relevant Ministries for your investment project. You need to prove that you have ability to conduct this project.
Time to get IRC: minimum 15 working days
2. Enterprise Registration Certificate (“ERC”)
After holding IRC, you will register forming a new company. In general, this step is faster.
ERC is issued by Business Registration Office
Time to get ERC: minimum 5 working days
After registering your company, follow these next steps:
3. Register for stamp of company
4. Buy a token key to do tax declaration and/or e-custom declaration
5. Register with Tax Department
6. Declare tax for each quater
7. In the end of fiscal year, your company shall complete a financial statement with audit
SHOULD YOU ENGAGE IN A LAWYER AND AN ACCOUNTANT
Company registration may seem like a major step in a new business venture for many people. Like anything, it can be daunting if you haven’t done it before and you definitely to make sure that it’s done correctly. Otherwise, you may waste a lot of time and pay fines if you do mistake, even a little one.
The process is generally quite smooth if you involve a professional to help you out. Every one wants to spend less time administering their business and more time running it.In Feline Legal, with many years experience in corporate services, lawyers and accountants will assist you and provide advance with forming your company. We also complete the paperwork, register your company and follow steps after that. You can save a lot of time and enjoy good services with reasonable price
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