Setting up a Company in Vietnam through Enterslice

The economy of Vietnam is the 47th largest economy in World. Creation of a company in Vietnam is slightly different to what an entrepreneur from another country might be used to. While the opportunities for companies based in Vietnam are persuasive, therefore the company registration process is more complex and bureaucratic than other countries. Taxes are reasonable in Vietnam as the income corporate tax rate is 20%.

Types of Entity established in Vietnam

1. Corporation: In Vietnam business can be set up in the form of Corporation in two ways:

a. Limited Liability Corporation: a Legal entity established by its members through capital contributions to the company. There are two types of Limited Liability Companies as explained below:

1. Single Member LLC: This type of entity has only one founder. In this type of business set up, the ultimate authority on deciding all business operations is on the owner itself.
2. Multiple Member LLC: This type of entity has not less than two members but it should not exceed fifty.

b. Joint Stock Company- This type of entities are permitted to issue shares to the public and may be listed on stock exchanges. The charter capital is divided into shares and each shareholder holds shares corresponding to the amount of capital contributed to the company.  Minimum of three shareholders are required in setting up this business. 

c. Partnership: At least two members are required to set up business in the form of Partnership. Liabilities of the partner are to the extent of all their assets.

Forms of Direct Investment in Vietnam

1. 100% FOES/Wholly foreign-owned: This type of entity is set up by one or more foreign investors, under a form of the enterprise as set out above. LLC or a JSC are the two common form.
2. Joint Venture: In this type of entity foreign investors and local partners come together for particular business agreement and register the same as per the applicable law and carries business activities in country
3. Business Cooperation Contract: It is a type of Cooperation agreement between foreign investors and a minimum of one or more Vietnamese associate with the intention to carry out a specific business activity.

Setting up a Company in Vietnam

Other facilities for business and investment in Vietnam

1. Branch Office: A foreign company can establish its branch office, with the prior approval from the government. The Branch will have to apply and obtain the establishment license, and retain a seal bearing the name of the Branch.
2. Representative Office: The foreigner can set up their business in Vietnam in the form of representative office. For working in this form, they will need to apply and obtain the establishment license; and have a seal bearing the name of the representative office.

Procedure for the Company registration in Vietnam:

In Vietnam Limited Liability Company, is the most popular form of setting up of business. Steps are explained below:

• First and the foremost step is to check the availability of the name and obtain business registration certificate as well as tax registration certificate from the local business registration office under the Department of Planning and Investment.
• Next step is to make a company seal and get the sample registered with business registration office.
• Open a Bank Account
• Buy preprinted VAT invoice from the Municipal Taxation Department or obtain and print self-printed VAT invoices.
• Next step is Publish the registration contents on the National Business Registration Portal (NBRP) 
• The applicant has to  pay business license tax;
• The applicant is required to get register with the local labor office to declare the use of labor (Municipal Department for labor, invalids, and social affairs). It has to be taken within 30 days of starting operations stating details of employee on specified format given by department;
• Register employees with Social Insurance Fund for the payment of health insurance and social insurance. On application duly complied and signed by the applicant within 30 days of application department will issue a registration certificate.

For further information mail us on info@enterslice.com