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Starting a Restaurant or Cafe business in Vietnam – Here are your legal guides

For overseas investors looking to open restaurant in Vietnam, open a cafe shop or set up a F&B business in Vietnam, this guide will provide highly useful information about legal steps and required licenses.

 

Business conditions

Under its WTO commitments, since 2015, Vietnam opened market for foreign investor investing in F&B business. Here are the business lines that you may register for your company:

– Catering food: for restaurant business;

– Drink services: for cafe business;

– Retail foods and alcohol;

– Produce food, processed food;

– Importing food.

 

 

Options to conduct a F&B business

Option 1. Merger or acquisition

This option gives investors many huge advantages. The previous owner might build a complete system, such as: infrastructure, equipments, staffs, customers, reputation and licenses. So in general, you do not need to waste time for setting up steps. However, investors should make a comprehensive investigation, such as: Legal and financial due diligence, in order to have a success transaction and reduce the risks from previous business.

Legal step for an M&A transaction:

Step 1. Legal Due Diligence and Financial Due Diligence (apply in some cases)

Step 2. Negotiate the price and sign M&A contract

Step 3. Register purchase share in Department of Planning and Investment (minimum 15 days)

Step 4. Amend the current Enterprise Registration Certificate of the Target Company (minimum 3 days)

 

Option 2. Set up a new business

At the beginning, you must build everything from zero: concept design, build and installation, food and menu development, find location, establishment company and apply for mandatory licenses (instructions below), etc. This option may fit for those who like to create, independent and do not want to have risks from previous business.

 

Finding location for your restaurant or cafe shop

In Vietnam, when applying for licenses to establish company, the DPI will require investors providing a specific address. So first step, you need to find a location for your restaurant or cafe shop. Then, sign a Template Contract or Memorandum of Understanding with the landlord. Remember that you must ask the landlord providing for you legal documents of that location, such as: Certificate of land right use and house ownership. Preferably, in this process, you should have a lawyer who may help you check all legal status of location. Because it is complicated issue in Vietnam, and you may lost money or deposit if you make mistake when renting a wrong location.

See more legal detail on location to open company in This Article.

 

Getting your Licenses and Registrations

There are many mandatory license to apply for. Here are the common ones for Food & Beverage business in Vietnam

1. Investment Registration Certificate (“IRC”)

Time: 15 working days (or more).

Check list of documents: 

Certificate of establishment or equivalence of the corporate investors (legalized by the Consulate of Vietnam and translated into Vietnamese); or passports of individual investors (notarized in Vietnam);Documents relating to financial status of the investors: financial statement of corporate investors or bank statements of individual investors;Lease agreement or equivalence (MOU) to prove the right of the Investor to use the Project’s premise (see more details in this Article); Dossiers (draft by law firm and signed & stamped by investors): Application for issuance of the IRC, Investment proposal, explanatory for invest project and  Power of Attorney authorizing.
 
Required capital for a F&B investment project: minimum 50.000 USD

2. Enterprise Registration Certificate (“ERC”)

Time: 4 working days (or more).

Check list of documents:

– Certificate of establishment or equivalence of the corporate investors (legalized by the Consulate of Vietnam and translated into Vietnamese); or passports of individual investors (notarized in Vietnam);

– Dossiers (draft by law firm and signed & stamped by investors):  Application for issuance of the ERC, Charter, List of members/shareholders,  Power of Attorney authorizing, etc

You may be interested in these topics: Types of company in Vietnam and How to name your company

 

 

3. Certificate of food safety condition (COFSC)

4. Registration for fire protection system (if any)

In case your restaurant or coffee shop is higher than 5 floor, registration for fire protection system is required. In order to satisfying the requirement conditions, during the building and installation process, you should hire a fire protection system consultancy company to help you. In general, the restaurant should have fire extinguishers, automatic fire extinguishers or smoke detectors. Management must be trained fire, electricity system must be able to bear the load in the peak time, the kitchen system should be airy, using standard gas cylinders by reputable suppliers.

 

5. Alcohol License (if any)

In case your restaurant serves alcohol products, your restaurant must obtain the Alcohol License. Requirements for sale of alcohol for on-premises consumption:

+ Alcohol consumed on premises shall be provided by the trader having the license for alcohol production/distribution/wholesaling/retailing.

+ All requirements for fire and environmental safety shall be satisfied.

+ The alcohol producer producing alcohol to sell for on-premises consumption shall have the license for mass production of alcohol or license for home production of alcohol for business purposes specified herein

Licensing authority: People’s Committees of districts

Time: 10 working days

 

6. Registration for the environment protection plan

If the size of your restaurant or coffee shop is over 200m2, your company shall register for the environment protection plan.

Licensing authority: People’s Committees of districts

Time: 10 working days

 

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

For more information, please leave a message in chat box, or

 

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