Company Incorporation Step by Step: Vietnam
By Celestine Loh, Date published: 2020-06-25
This article covers the main points on registering a company in Vietnam. Read on for details on Vietnam’s requirements, procedures, and the estimated timeline to register a company.
Minimum Setup Requirements to Register a Company in Vietnam
- Resident Director – 1
- Application form for registration
- Official copy of Personal Identification papers
- Articles of Association
- Registered Capital
- Physical proof of company physical address
- Investment Registration Certificate
Vietnam has a strict and highly bureaucratic process for the incorporation of any company. The entire process takes roughly 45 working days to officially get your company registered.
It is done through a 24/7 online portal on the National Business Registration System (NBRS). The online platform provides videos that guide the user through the different steps and documents required to register the company. More information can be found here.
Step 1: Deciding your Business Scope
Vietnam has been known to be well receptive of foreign ownership of businesses. In most of the economic sectors, Vietnam allows 100% foreign ownership. However, there are certain sectors that are restricted and foreign ownership is on a ministerial level approval basis.
Thus, the very first step is to decide the type of sector to do business in and if foreign ownership is required.
If foreign ownership is required, it is in accordance with the World Trade Organization (WTO) agreement requirements.
Step 2: Minimum Capital Requirement
Although there is no stated/specified capital requirement, Vietnam requires the minimum capital to be reflective of the type of business activities you are partaking in.
In general, the minimum amount of capital is around USD$10,000.
*At this stage, it is required for an application to be made to the Department of Planning and Investment. You can only proceed once you have received approval in the form of an Investment Registration Certificate (IRC).
Step 3: Obtain a Physical Company Address
There needs to be physical proof of the proposed company address to be submitted with the application.
Step 4: Decide on the Internal Management Structure
Official documents are required to prove the formal appointment of key officeholders.
Choosing your Company Name
As mentioned earlier, there are video tutorials that go through the relevant documents and steps for each stage to register the company. This video takes the user through the requirements for choosing the company name.
Vietnam follows the Vietnamese Accounting Standards (VAS), which follows the skeletal standards from the International Financial Reporting Standards (IFRS) issued by the International Accounting Standard Board (IASB). All records relating to the business must be maintained and recorded to fully reflect the correct amounts.
Corporate Tax Requirements
The standard corporate tax rate is 20%. However, the tax rate is higher for selected sectors like oil, gas and mining.
Annual General Meeting
Companies are usually required to hold their Annual General Meeting by the end of the first quarter of each year (i.e. April). Companies also follow the calendar year and thus, the financial year ends on 31st December.
This article does not constitute legal advice.
The opinions expressed in the column above represent the author’s own.